South Boulder Mines (ASX:STB) has announced a new scoping study in their Carnalite-project in Eritrea. Their first study that was published last year only focused on the production of sylvinite (and will be used as basis for the DFS next year), whereas this new scoping study investigated the possibility of a 2Mtpa carnalite production. This additional carnalite production could reduce the strip ratio and increase the total output to over the planned 1Mtpa sylvinite production.
The Sylvinite-Carnalite option would have an annual output of approximately 2Mtpa for a 26-year mine life. The capex comes in at approximately A$1.5B and the operating expenses (C1) will be a little bit under A$200/tonne.
South Boulder plans to stick with its 1Mtpa Sylvinite plan as the additional A$0.8B in capex might be too difficult to raise in these market conditions.
As South Boulder is moving into the right direction, we hope our Canadian favorite Allana Potash (AAA.TO) is doing the same. Allana expects to release a Feasibility Study before the end of January, and we are confident their final numbers will be roughly the same as in the PEA they announced late last year.
Download the full press release here
Disclosure: The author holds no position in South Boulder Mines Ltd., but has a long position in Allana Potash Inc. Please see our disclaimer for current positions.
