Australian company seeks potash mining licence in Eritrea

Tue May 3, 2016 11:12am EDT
 
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* Eritrea wants mining to help to kick-start economy

* Potash project is 50:50 venture with state firm

* Talks ongoing for binding deals with potash buyers

By Edmund Blair

NAIROBI, May 3 (Reuters) - Australia mining group Danakali Ltd has applied to Eritrea for a mining licence for its Colluli Potash Project, which is expected to start production in 2019, the company's chief executive said.

Eritrea, which became independent from Ethiopia in 1991 after years of fighting, wants to establish a mining industry to help to bolster its economy.

The country has deposits of gold, copper, zinc and fertiliser-ingredient potash. Its first commercial-scale mine began production in 2011.

Danakali Chief Executive Paul Donaldson said the aim was to secure project development funding, commercial offtake contracts and approvals to start construction.

"We anticipate being in production by 2019," he told Reuters.   Continued...