The race is on to satisfy accelerating
world demand for potash, and in
this Olympic year Allana Potash is
in gold medal position as its Dallol
Project in the Danakhil region of
Ethiopia has the finishing line in sight.
Potash is a generic name for a variety of
potassium salts, the most common being
potassium chloride (KCl), also known as
muriate of potash (MOP) and sulphate of
potash (K2SO4) or SOP. Around 95 percent
of global production is used in fertiliser to
improve water retention, yield, nutrient
value and disease resistance of food crops
such as fruit and vegetables, rice, wheat,
sugar, corn, soybeans, palm oil and cotton.
The world’s largest producer of potash,
by some distance, is Canada, with the
largest consumers being China, the
United States, Brazil and India. So why is
a Canadian exploration company putting
all its resources into developing a potash
operation in Ethiopia?
There are many answers to that question,
and they all combine to put Allana Potash in
a very strong position to supply the growing
fertiliser markets in China and India—with
Ethiopia’s location on the horn of Africa
being virtually next door, compared to
Canada or Russia.
First of all, there is an abundance of potash
in Ethiopia, where it was first mined in the
fourteenth century. “We secured some very
interesting drill results from a company
called Parsons and Co, an exploration
company that was operating in Ethiopia in
the 1960s,” said Richard Kelertas, senior vice
president, corporate development. “They
Allana Potash
“There’s enough there for a million
tons a year for thirty or forty years”
had done well over a hundred drill holes in
the depression where we are operating and
the results looked extremely promising.”
Until relatively recently, he explained,
the principal method of mining for potash
was deep shaft, which was not particularly
suitable in this region of Ethiopia which
is subject to very hot temperatures, so the
property had been abandoned. The Dallol
Project, however, is perfect for solution
mining, a method which pumps brine into
drill holes to dissolve the potash, then pumps
the resulting solution to the surface where
it is transferred to evaporation ponds to dry
before final processing to remove the salt.
With the potash deposits being relatively
shallow and a hot climate that allows for
natural solar evaporation, Allana benefits
from minimal capital expenditure and low
operational costs into the bargain.
Another bonus is that at a time when
some governments have been revoking
promises they made to mining operators, the
Ethiopian government has been extremely
helpful. “When we first looked at it three or
four years ago, the infrastructure left a lot
to be desired,” said Kelertas. “But we had
assurances from the Ethiopian government
that they were going to upgrade the road
system, and they came through on that. All
things considered, low cost, low cap-ex, low
op-ex, and the fact that the resource was
quite substantial and shallow led us to go
ahead with exploration work a couple of
years ago. Most of our drilling has been
in the western areas on the salt plain,” he
continued, “and there’s enough there for a
million tons a year for thirty or forty years.”
The advantages of the climate are quite
significant. “This is one of the hottest places
in the world,” said Kelertas, “but that helps
us keep our op-ex costs very low. We do not
have to build expensive evaporators as you
do in cooler parts of the world. We’re using
solar evaporation ponds,
where the energy from the
sun evaporates the potash
brine. There are some
implications to operating
in a hot climate but
the advantages far outweigh
the disadvantages.”
The project’s desert
location has other
advantages, too, from an environmental
point of view. There’s no flora and fauna and
there is only a small indigenous population,
which is actively engaged in the development.
Concerns about sustainability in potash
mining are just the same as they are in any
mining operation, said Kelertas, especially
when open pit or deep shaft mines are
Potash salt and halite crystallization in pilot test evaporation ponds
Allana Potash
involved, but here’s where
solution mining scores again.
“With a solution mine, the
environmental footprint
is almost nil. It’s only the
plant facility, the pumping,
whatever energy you’re
going to use, the drill sites,
the well sites and the piping.
Other than that there’s no
excavation work, and no emissions to speak of.
Allana employs a lot of Ethiopians in its
exploration and development operations so
a small village has sprung up close to the
site, where temporary housing, a school, and
a medical clinic have been built. “Once we
start construction that village is going to
get a lot bigger, so we’ll be working closely
$8 00 Million
Total project cost