About The Assets
EGME acquired the exploration license for the Bada potash mine in May 2015. The license area comprises 626km, and is located in the northern most part of the Danakil region of Eritrea, East Africa.
The Danakil Depression is world renowned for possessing significant accumulations of potash salts. Several potash projects to the south of Bada and across the border in Eritrea have significant proven potash reserves. Based on the physiographic features and location of the Bada basin, it is clear that the area possesses a suitable depositional environment for potash accumulation.
The license area is approximately 330km by road from the capital city Asmara and 230km from the port of Massawa. This proximity to established infrastructure links provides the means to service the strong demand for potash in India and China. EGME estimates that Bada possesses approximate reserves of more than one billion metric tons of potassium-bearing salts and production is anticipated to commence at the end of 2017.
In November 2016 EGME signed a Memorandum of Understanding (MOU) with Gensource Potash Corporation to form a joint venture company that will focus on the development of one of Gensource’s Potash Projects in the Vanguard area in Saskatchewan, Canada.
The Vanguard Potash Project is situated in South Central Saskatchewan near the villages of Tugaske and Eyebrow. The results from a Preliminary Economic Assessment (PEA) completed in May 2016, have determined that the Project has 64 million tonnes of inferred resources and an initial production plan of 250,000 tonnes of potash per annum, with the ability to expand significantly beyond the initial production target. Under the current work programme two new wells have been drilled and a 3D seismic survey is scheduled to take place in Q1 2017. Site construction is planned to commence in Q3 2017, with first production likely in mid-2019. The Project benefits from strong local and provincial support and is in close proximity to existing infrastructure providing easy access to roads, gas, power and a robust rail network for product movement to domestic and international customers.
Under the terms of the MOU, EGME will provide business and logistic expertise and will deliver financing for the project over two stages. The first financing tranche will fund the completion of the feasibility study that is currently underway and expected to be completed in Spring 2017. The second injection of capital will fund the construction of the project. Gensource will commit the mining area and mineral resource as well as its project execution team, which possesses the necessary technical experience of selective solution potash mining and specialized processing, to the JV.
Post financing, EGME will hold a 70% economic interest in the JV.