Name of the Project
Kola potash project.

Location
Sintoukola basin, Congo-Brazzaville.

Project Owner/s
Kore Potash and Summit Consortium, a subsidiary of PowerChina, comprises OWI Global, which will provide royalty financing in conjunction with product offtake; Sepco; and China ENFI Engineering Corporation. Sepco will be the engineering, procurement and construction, with China ENFI being a subcontractor.

Project Description
Kore Potash completed a definitive feasibility study (DFS) in 2019, in which it proposed a production estimate of 2.2-million tonnes a year of muriate of potash (MoP). This is based on a mine life of 33 years comprising 23 production years, exploiting ore reserves of 152.4-million tonnes and 9.7-million tonnes of inferred mineral resources, and an additional ten production years exploiting 70-million tonnes of the remaining inferred mineral resources.

Total MoP production has decreased from 2.2-million tonnes a year in the 2019 DFS to 2.14-million tonnes a year in the 2022 optimisation study.

The optimisation study estimates a 31-year mine life, which includes 25 production years exploiting ore reserves of 152.4-million tonnes, together with 9.7-million tonnes of inferred mineral resources, and an additional six production years exploiting 49-million tons of the remaining inferred mineral resources.

The Kola orebody is planned to be mined using conventional underground mechanised methods, extracting the ore within ‘panels’ using continuous miner equipment of the drum-cutting type. Mine access will be provided through two 270-m-deep vertical shafts, each 8 m in diameter. The shafts will be sunk near the centre of the orebody.

Underground access will be provided through equipping the intake shaft with a hoist and cage system to transport persons and material.

The exhaust shaft will be equipped with a pocket lift conveyor system to continuously convey the mined-out ore to the surface.

Ore from underground will be transported to the process plant using a 24-km-long overland conveyor. A conventional potash flotation plant with a maximum design capacity of 2.24-million tons a year of MoP has been designed for the project. As a result of the low insolubles content, no separate process circuit will be required to extract insoluble material. The final MoP product will then be transported 11 km using a conveyor belt from the process plant to the marine export facility at the coast.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The optimisation study estimates an ungeared after-tax net present value (NPV), at a 10% discount rate, of $1.62-billion and an internal rate of return (IRR) of 20%, compared with an NPV, at a 10% discount rate, of $1.42-billion and an IRR of 17.2% in the DFS.

Capital Expenditure
Capital cost reduced was reduced by $520-million to $1.83-billion on an engineering, produrement and construction (EPC) basis in the optimisation study, compared with the DFS capital cost of $2.35-billion on an equivalent EPC basis.

Planned Start/End Date
The 2022 optimisation study has reduced the construction period from 46 months in the DFS to 40 months.

Latest Developments
Kore Potash has advised that the conditions for conversion of five convertible loan notes totalling $530 000 have been met, and, accordingly, will now be converted into 109-million new ordinary shares in the company at 0.38p apiece.

The company will use the proceeds to advance work on the Kola project, as well as for working capital.

Kore’s total issued share capital now consists of 4.22-billion ordinary shares.

Meanwhile, Kore reported in its results for the year ended December 31, 2023, that tangible progress has been made towards financing the project.

Further, PowerChina delivered its EPC proposal and draft EPC contract on February 6, which the companies are working towards signing in the second quarter.

Kore expects to raise more funds in the second quarter of 2024 for working capital requirements until signing the full EPC documentation and the financing proposal for the construction of Kola.

Summit Consortium has confirmed that the financing proposal for the full capital cost of Kola will be provided within six weeks of finalisation of EPC contract terms.

Kore is also continuing its dialogue with the Congo-Brazzaville authorities, including the Ministry of Mines, to improve government’s understanding of the company’s Kola and Dougou projects in the country.

Key Contracts, Suppliers and Consultants
Met-Chem DRA Global (mineral resource estimate); and SRK Consulting (environmental- and social-impact assessment).

Contact Details for Project Information
Tavistock, on behalf of Kore Potash, tel +44 207 920 3150 or email kore@tavistock.co.uk.