A SECOND prospective Western Australian Sulphate of Potash (SoP) fertiliser producer is being assessed for a concessional Northern Australia Infrastructure Facility (NAIF) loan to fund capital works.
Australian Potash - APC on Australian Securities Exchange (ASX) listings - last week announced the NAIF board has started a due diligence assessment of its Lake Wells SoP project, 180 kilometres north east of Laverton.
APC managing director and chief executive officer Matt Shackleton said discussions with the NAIF board were confidential at this stage.
"The NAIF and APC have engaged on a very proactive basis to date on the (Lake Wells SoP project) funding application and it is pleasing that the NAIF has committed to the formal due diligence process," Mr Shackleton said.
NAIF can provide up to 100 per cent of approved project development debt and concessional conditions can include extended repayment terms out to nearly 30 years, lower interest rates than generally available from other lenders and tailored repayment schedules.
In February last year the NAIF board approved a $74 million loan to Kallium Lakes Ltd (KLL on ASX listings) as its first loan to a prospective WA SoP fertiliser producer.
KLL, which is due to become the first Australian commercial producer of SoP fertiliser at its Beyondie project 160km south east of Newman at the end of this year or early next year, used the NAIF funds to build a 78km gas pipeline, gas-fired power station, airstrip, accommodation village, access road and communication infrastructure.
A third prospective SoP producer, Agrimin (AMN on ASX listings), has also talked to the NAIF board about a development loan to fund its project at Lake Mackay on the WA-Northern Territory border north east of the remote Kiwirrkurra community.
AMN has been stockpiling salts from a trial series of evaporation ponds and, like APC and KLL, has produced samples of SoP fertiliser from its harvest salts.
As previously reported in Farm Weekly, commercial production of SoP fertiliser in WA is expected to launch a substantial fertiliser export industry for the State, with initial production forecasts of any one of several companies due to start production within two years far exceeding Australia's 40,000 tonnes per annum current usage.
APC last month announced it is finalising its first offtake agreement for 20,000tpa of its Lake Wells premium K-Brite trade-named SoP for distribution throughout Australia and New Zealand.
It is also continuing negotiations with potential offtake partners for South East Asia, China, Europe and North and South America and plans to begin production later next year.
In February Salt Lake Potash Ltd (SO4 on ASX listings) announced it had signed a binding term sheet with Mitsui & Co for the sale of premium water-soluble SoP from its fast-tracked Lake Way project 12 kilometres south of Wiluna.
Under the proposed agreement Mitsui, a major global manufacturer and distributor of fertilisers, will sell and deliver 4000tpa of SO4 water-soluble SoP into Bangladesh, Cambodia, Japan, Malaysia, Philippines, South Korea, Sri Lanka and Taiwan over five years.
SO4 has said with this offtake agreement, 224,000tpa of its projected 245,000tpa Lake Way production will be accounted for.
It plans to begin production early next year.
KLL has an exclusive 10-year 90,000tpa deal with German-based global fertiliser distributor K+S which covers all of its initial production for sale and distribution throughout Australia and internationally.
- APC has advised shareholders to stay away from its general meeting in West Pert this Thursday. Due to COVID-19 health concerns it has made provision for shareholders to listen to the meeting and participate remotely, rather than attend in person.
