London-listed potash junior Kanga Potash has been granted an exploitation license by the Republic of Congo (ROC) to begin mining and production, and now has all the necessary regulatory consents to enter the pre-construction phase of the project.
Ratification by the ROC parliament is the only pending matter for final approval, the company said. The ESIA for the project was approved in March 2021.
The license area granted to Kanga Potash covers 320 km2 and is located 32 km north of Pointe Noire on the Atlantic Coast, the country’s second-biggest city and economic hub.
The company is targeting an initial production of 600,000 mt/y of potassium chloride.
Exploration drilling in 2017 has shown potash seams with a mineable thickness in excess of 210 meters at an average 68% carnallite grade (KCl 18.2% equivalent) at depths between 300 meters and 1,100 meters, according to Kanga.
Due to these “ultra-thick” potash seams, the company sees the life of mine as in excess of 30 years and believes the modular nature of the project processing plant design facilitates options for production to be increased to above 2.4 million mt/y, as and when market conditions allow.
The planned processing plant – to be located at the coast – will also include an owner-operated transhipment jetty. Kanga will use an existing valve station connection via an approved, dedicated 33 km-long natural gas pipeline to access long-term, competitively priced natural gas from one of the ROC’s major oil and gas producers.
Kanga said it has secured two Letters of Intent for potash offtake, from what it describes as “a reputable trading company” and “a Fortune 500 company” for 100% of the initial designated production.
The company said it also has received MOUs from pre-qualified EPC contractors for a highly leveraged finance solution with the backing of Export Credit Agencies to fund up to 85% of the required capex for the project via debt subject to meeting local content requirements. The project cost is currently put at around $457 million.