Allana Potash (TSX:AAA) updated investors on the changing potash market and how the company is working towards meeting the challenges of the market with its Ethiopian project.
According to the company’s senior vice-president of corporate development, Richard Kelertas:
Unlike major projects that have faced cancellations or significant delays due to declining potash prices, Allana has a number of unique advantages, including an extremely low capital expense/operating expense model and a growing number of investment partners. What we have with Danakhil is a world-class, high-grade potash resource that we can access with cost-effective, proven mining methods.
Farhad Abasov, Allana’s chief executive officer commented:
Ultimately Allana’s success will hinge on three principles. First the shallow nature of the deposit and the hot climate offer a significant advantage in terms of cost structure. Second, we are able to attract project financing from large global financial institutions with mandates to spur economic development in emerging nations. In terms of general development, over $3-billion of foreign direct investment has been made in the agriculture sector in Ethiopia alone. Third, the Ethiopian government is extremely supportive. In fact, we are one of only a few projects that are fully permitted. In addition, the federal government is taking on many of the construction expenditures relating to infrastructure building that will help ensure the long term success of our project.