Preliminary data for the expressions of interest in Western Australian sulfate of potash (SOP) junior company Salt Lake Potash (SO4), Perth, should be available by April 4, according to the Australian Financial Review (AFR). SO4 became insolvent last fall, and creditors appointed KordaMentha Restructuring, the distressed business division of KordaMentha, an advisory and investment firm, to take over (GM Oct. 22, 2021).
Advisor Macquarie Capital announced last month that it would be commencing a process to sell SO4’s flagship Lake Way Project or recapitalize the company. They are seeking expressions of interest.
SO4’s Lake Way Project was slated to begin SOP production in June 2021. However, in late July, the company revised its ramp-up schedule and said it would need more money to proceed (GM July 30, 2021). SO4 also in late July halted trading on the Australian Stock Exchange (ASX) pending further announcements. It was halted on London’s Alternative Investment Market (AIM) on Oct. 19.
According to AFW, Lake Way had disappointing geological and processing results and investors did not come forward to fill the latest gap, after having been tapped 11 times for a total of $507 million of debt and equity over the past five years. Creditors are now reportedly owed A$170 million (US$127 million). Australia’s Clean Energy Finance Corp. is reportedly owed US$47 million.
At full production, SO4 had planned an output of 245,000 mt/y of SOP. As of last March, it said it had in place around 224,000 mt/y of binding offtake agreements for five- and ten-year terms (GM March 26, 2021; Dec. 20, 2019).
These deals included: Helm AG, Germany, 50,000 mt/y for 10 years from start of production for sale within Southeast Asia and the Middle East (GM Dec. 20, 2019); Unifert for 60,000 mt/y in the Middle East and Africa; Indagro for 50,000 mt/y for North America and Europe; and Fertisur for 60,000 mt/y in South America (GM Nov. 22, 2019).
In the meantime, SO4 has increased its Measure Mineral Resource projections from the project by 108 percent, from .90 million mt to 1.87 million mt, based on drainable porosity.