Verdant Minerals Signs Phosphate Offtake MOU for Ammaroo

Through a non-binding memorandum of understanding (MOU), Verdant Minerals (ASX:VRM) is set to provide phosphate rock concentrate to Ameropa Australia.

Material will come from Verdant’s Ammaroo phosphate project, located 220 kilometers southeast of Tennant Creek in Australia’s Northern Territory.

According to a Monday (May 21) release, the company will provide Ameropa, a fertilizer manufacturer, with up to 100,000 tonnes a year of phosphate rock concentrate or other phosphate products.

The main Ammaroo resource was discovered in 2010, and Verdant has been developing the project since then, with several assessments taking place in 2014.

Last week, the company released a feasibility study for the project, reporting that Ammaroo is “technically feasible and will deliver positive economic benefits, if developed in accordance with the prescribed design criteria.”

The study pegs Ammaroo’s initial mine life at 20 years, with output set at 1 million tonnes of phosphate rock concentrate per year. That number is anticipated to increase to 2 million tonnes annually starting in the mine’s sixth year.

Processing testwork from the study shows that the property will produce high-quality phosphate rock concentrate grading close to 33 percent phosphorus pentoxide.

A final investment decision is planned for the end of Q4 2018, with construction to start in early 2019.

Verdant has eight projects under its belt right now, but Ammaroo is one of its two biggest assets, alongside its Karinga Lakes potash project, also in the Northern Territory.

Karinga Lakes became a $3-million joint-venture with Aqua Guardian Group in 2017, and that company has a 40-percent stake.

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Securities Disclosure: I, Olivia Da Silva, hold no direct investment interest in any company mentioned in this article.