The Colluli Potash Project INVESTOR PACK€¦ · Favourable Project Economics The PFS development...

INVESTOR PACK The Colluli Potash Project

AUGUST 2015

Project SummaryDanakali Limited (ASX:DNK) is focussed on the development of the Colluli Potash Project. The project is located in the Danakil region of Eritrea, East Africa and is 100% owned by the Colluli Mining Share Company (CMSC). CMSC is a 50:50 Joint Venture between Danakali Limited and the Eritrean National Mining Company (ENAMCO).

Demand for potash is expected to substantially increase over the coming decades as the global population continues to grow by approximately 80 million people per year. Eritrea is geographically favourable relative to the key markets of the future, and is a stable jurisdiction with a maturing mining industry.

The exploration tenements cover over 200km2 and comprise almost 1.3 billion tonnes of potassium-bearing salts suitable for the production of potash fertilisers. Over 1.1 billion tonnes of the resource is included in the ore reserve, and the massive expected resource recovery is a direct result of the shallow mineralisation of the potassium bearing salts. With mineralisation commencing at just 16m, Colluli is the shallowest known evaporite deposit in the world and is amenable to open cut mining. Open cut mining is generally a safer, more productive mining method in contrast with underground mining.

The variety of potassium bearing salts contained within the Colluli resource provide it with an unrivalled capacity to produce a range of potash fertilisers, which will allow the project to grow in both scale and product suite over time. The project also has substantial upside potential due to the large contained volumes of rocksalt, magnesium chloride and gypsum.

A two phase modular development approach underpins a highly favourable prefeasibility study (PFS) for the production of potassium sulphate (sulphate of potash or SOP). SOP has limited primary production centres globally as a result of geological scarcity. Only three primary production centres exist in the world. The first phase of the development as a standalone project has an internal rate of return (IRR) of over 22%. The economics of Phases I and II combined result in an attractive estimated IRR of over 24%. The definitive feasibility study is expected to be completed by the end of 2015.

Favourable Project EconomicsThe PFS development considered two SOP production modules. Each module producing 425,000 tonnes per annum. Phase I is expected to be commissioned in late 2018, with Phase II coming into production five years later. An economic snapshot of the PFS project financials is shown in Table 1.

Table 1: Summary of Pre-feasibility study economic outcomes.

Outcome Unit Phase I Phase II¹

Annualised SOP Production Kt 425 850

Development Capital (including 15% contingency) US$m 442 2822

Average SOP Price (FOB Anfile Bay) US$/t SOP 588 588

Average Mine Gate Cash Costs US$/t SOP 162 141

Average Total Cash Costs3 US$/t SOP 210 189

Post tax NPV (10%) – Project US$m 462 846

After tax Internal Rate of Return - Project % 22.3 24.7

Post tax NPV (10%) – DNK4 US$m 206 397

Post tax Internal Rate of Return - DNK % 22.3 25.9

Undiscounted cash flow (cumulative) US$m 2,645 5,134

¹ Based on an additional 425ktpa Phase II commencing production in year 52 Additional capital required for second production module3 Includes mine gate costs, logistics and royalties4 In accordance with the CMSC Shareholders Agreement

1DANAKALI LIMITED | The Colluli Potash Project: Investor Pack

What is Potash?Potash is a generic term for potassium bearing minerals primarily used as fertiliser, and is an essential, non-substitutable ingredient for food production. A diverse range of potash types exist in the market, and are differentiated by chemistry and crop application.

Geological abundance of suitable potassium salts and processing requirements to generate the different potash types are variable, resulting in a range of prices for different potash types in the market. Typical potash types, uses and indicative pricing are shown in Table 2.

Potash growth is underpinned by strong demand drivers including growing population, reduction in arable land and changing dietary preferences. The overall equation for ongoing growth in potash demand however is simple:

Table 2: Potash types and indicative prices

Potash Type Commonly known as Typical Sale PriceUS/tonne1

Nutrients Uses

Potassium Chloride MOP 315 Potassium Staples – wheat, corn, chloride tolerant

crops

Sulphate of Potash Magnesia

SOP-M 400 Potassium, sulphur and magnesium

Specialty fertiliser,

Sulphate of Potash SOP 720 Potassium and sulphur

Chloride intolerant and specialty crops

such as fruits, vegetables, nuts, beans and coffee

Potassium Nitrate NOP 900 Potassium and nitrogen

Chloride sensitive crops that require

additional nitrogen

¹ May 2015 - Greenmarkets, Compass Minerals Quarterly Report, Potash Corp

Oxygen

Carbon dioxide

Sunlight

Vitamins

Proteins

Carbohydrates

Oils

Nutrients

Water

P

K

N

2 DANAKALI LIMITED | The Colluli Potash Project: Investor Pack

Colluli; Positively UniqueThe Danakil region of East Africa is an emerging potash province of significance. Over 10 billion tonnes of potassium bearing salts have been identified to date, and the region has attracted a number of major fertiliser players including ICL and Yara International.

Unlike the current major potash producing basins of the world, the Danakil region contains a variety of potassium bearing salts, providing the opportunity to generate a range of potash fertilisers. The Danakil basin contains the only potash resource in the world that allows such product diversity.

A number of attributes combine to make Colluli an outstanding opportunity. These differentiating factors, shown below, make Colluli the most attractive SOP and potash development project in the world.

The content of this investor pack introduces the attributes which, together, illustrate how Colluli is positively unique.


Large Resource Suitable for PotashFertiliser Production

The Colluli resource contains approximately 1.3 billion tonnes of potassium bearing salts including sylvinite (sylvite plus halite), carnallitite (carnallite plus halite) and kainitite (kainite plus halite). The Mineral Resource estimate prepared and reported under the guidelines of the 2012 JORC Code is shown below in Table 3.

Table 3: Colluli Mineral Resource Estimate

Potassium Salt Type

Measured Indicated Inferred Total

Mt K2OEquiv %

Mt K2O Equiv %

Mt K2OEquiv %

Mt K2OEquiv %

Sylvinite 90 13 160 13 15 9 265 12

Carnallitite 80 7 303 8 15 11 398 8

Kainitite 133 12 488 12 5 12 626 12

Total 303 11 951 11 35 10 1289 11

Shallow MineralisationWith mineralisation commencing at just 16m, the Colluli resource is the shallowest known evaporite deposit globally, and is amenable to open cut mining. Open cut mining is a proven mining method for salts, is a safer mining method than underground mining, and gives better overall resource recovery. The alternate methods for mining potash are underground mining and solution mining. Most underground potash mining utilises the “room and pillar” method, which requires over 50% of the resource to be left in the ground for roof support. Solution mining also sterilizes large portions of the resource for cavern support, with losses further exacerbated by high levels of geological discontinuity of the resource and narrow seams.

The large Colluli Ore reserve is shown in Table 4 and the overall conversion of Mineral Resource estimate to Ore Reserve for different mining methods is shown in Figure 1.

Table 4: JORC 2012 Colluli Ore reserve at 19 May 2015

Potassium Salt Type

Proved Probable Total

Mt K2OEquiv %

Mt K2O Equiv %

Mt K2OEquiv %

K2SO4 Equiv %

K2SO4 Equiv Mt

Sylvinite 78 15 174 12 252 13

Carnallitite 79 7 283 8 362 8

Kainitite 130 12 363 11 493 11

Total 287 11 820 10 1107 10 18.5 205


Figure 1: Conversion of Mineral Resource to Ore Reserve with different mining methods1. Underground mining methods and applications, company reports

2. Danakali Mineral Reserve, Allana Potash , IC Ochoa

In addition to safety and resource recovery benefits, open cut mining utilising surface miners results in a high level of selectivity which is essential for the multi salt composition of the Danakil resource. Highly selective mining ensures that processing operations are not disrupted by chemical and solubility variations arising from the different salt types. Surface mining allows controlled extraction, stockpiling and processing of the different salts and avoids the brine chemistry complexities of solution mining. Figure 2 represents how the Colluli Resource could potentially be mined.

Figure 2: Simple representation of mining method of the Colluli Resource

The growth increment of open cut mines is not determined by underground workings or hoist shaft capacity which are key drivers of underground mining capacity additions. The open cut mining method allows moderate, less capital intensive growth.

“Alternative mine methods sterilise a substantial portion of the resource”


Close Proximity to CoastOnly 75km separates the Colluli site from the Red Sea coast line making it one of the most accessible potash deposits in the world. The Port of Massawa is located 180km away and is connected to the Colluli site via the coastal road. The proximity to coast gives the project access to the global export market via one of the busiest trade routes in the world.

Figure 3: Distance of Colluli to Anfile Bay and comparative distance to coast for key SOP areas1. Company announcements: Allana Potash, Circum

2. Danakali Analysis

Favourable Combination of Salts for Production of SOP

The Colluli resource contains kainite, sylvite and carnallite ores. Sylvite and carnallite both produce potassium chloride, which is then combined with kainite to form high purity potassium sulphate.

Kainite is the most important salt globally for the primary production of potassium sulphate. Kainite is typically precipitated from potassium rich brines, and then processed to generate potassium sulphate.

In the decomposition of kainite, excess sulphate is generated which, through the addition of potassium chloride, substantially increases the product yield via a highly thermodynamically and kinetically favourable process. The combination of potassium chloride and kainite is the lowest energy input, highest yield conversion route to product potassium sulphate.


Figure 4: Simplified process flow for the production of SOP from the Colluli Resource

Combining kainite with potassium chloride is commercially proven and primarily utilised by operations producing SOP from potassium rich brines. Brine producers that cannot generate potassium chloride from the resource, typically purchase potassium chloride from the market to combine with kainite.

Salts Extracted in Solid Form

Extraction of the salts in solid form, using open cut mining methods, is a key positive differentiator of Colluli. All primary production of potassium sulphate from kainite throughout the world commence with low potassium content brines which require substantial solar evaporation to generate a harvest salt for subsequent processing. In some cases, depending on the ambient conditions, this process can take over two years. Salts in solid form allow immediate processing, and substantially reduces the size of the solar ponds required for evaporation.

One of the most important benefits of having the salts in solid form is the immediate generation of final product, hence revenue, relative to solution mining or brine operations which have substantial lead times associated with the generation of harvest salts for subsequent processing. In contrast, brine operations have a substantial lead time between the time of the capital investment and the time to generate product and revenue.

Unrivaled Ability to Diversify Potash TypesThe diversity of potassium bearing salts in the Danakil region allows the production of a variety of potash types including potassium sulphate (SOP), potassium magnesium sulphate (SOP-M), gypsum and potassium chloride (MOP). No other potash resource in the world allows such diversification.


Table 5: Potential of the Colluli Resource against potash types

Potash Type Commonly known as Colluli Potential Nutrients Uses

Potassium Chloride MOP Potassium Staples – wheat, corn, chloride tolerant

crops

Sulphate of Potash Magnesia

SOP-M Potassium, sulphur and magnesium

Specialty fertiliser,

Sulphate of Potash SOP Potassium and sulphur

Chloride intolerant and specialty crops

such as fruits, vegetables, nuts, beans and coffee

Potassium Nitrate NOP Potassium and nitrogen

Chloride sensitive crops that require

additional nitrogen

High Purity ProductPilot test studies completed on the Colluli salts with the Colluli process design demonstrate that Colluli will be at the top of the quality spectrum. Typical sulphate of potash contains approximately 94% potassium sulphate, in contrast, the Colluli process is expected to generate product with purity of 98%. Standard, granular and soluble products will be generated for distribution to the market. Pilot tests from the Colluli salts have generated product samples for marketing purposes which are now being distributed to prospective customers.

Colluli pilot test generated SOP samples for marketing2

Collui SolubleFine powder - rapidly dissolves in water.Suitable for open feed fettigation, foliar feeding and greenhouse and hydroponic systems

Colluli StandardSuitable for application on hardy crops and in manufacture of compound fertilisers

Collui GranularSuitable for bulkblends, mechanisedspreading and formanual application

1. Company websites2. DNK: Colluli Salt Plant Samples


Logistically Superior to Key Markets of the Future

Colluli is geographically advantaged relative to the key potash markets of the future. Demand for fertiliser is driven by population growth which directly translates to food demand. Almost 95% of the population growth over the next three decades will occur in Africa, India and South East Asia. The relative location of the Colluli resource to these key markets gives it a significant logistics advantage and unrivalled access to the potash markets of the future.

Distance from major population growth centres (km)

Substantial Project UpsideIn addition to the potassium bearing salts, Colluli contains appreciable amounts of rocksalt, magnesium chloride and gypsum. All of these products have established global markets. The rocksalt, magnesium chloride and portions of gypsum must be mined to access the potassium bearing salts, resulting in low production costs for these materials.

Resource definition is currently underway for the rocksalt resource. Preliminary analysis indicates that the rocksalt contained in the Colluli resource is suitable for de-icing purposes.

“Almost 95% of the population growth over the next three decades will occur in Africa, India and South East Asia.”


Lowest Estimated Capital Intensity and Operating Costs

Colluli is one of only two advanced potash projects in the world with development capital costs less than US$450m, and is estimated to have the lowest capital intensity. This is achieved as a consequence of the reduced evaporation pond footprint, hence substantially smaller surface foot print. Operating costs are also substantially lowered as a result of efficient infrastructure use facilitated by salt extraction in solid form and low energy input conversion to SOP. There are clear economies of scale as the project transitions from Phase I to Phase II, which convincingly separate Colluli on the cost curve.

Definitive Feasibility Study Imminent The Colluli definitive feasibility study is well advanced and expected to be complete in 2015. All environmental baseline submissions for assessment have been completed and submitted to the Eritrean Environmental Ministry. Project teams have completed site visits and evaluated the in country facilities available to support the construction activities.

Pilot testing and optimisation of the process plant design commenced immediately following completion of the prefeasibility study, and sufficient volumes of SOP have been generated for distribution to prospective customers.

1. CRU Research, EPM Mining presentation 2014, Company websites, Integer Research

2. Danakali Analysis

“Colluli has the potential to be the lowest cost producer globally”

“Colluli is one of only two SOP projects in the world with development capital under US$450M”


About Danakali LimitedDanakali Limited (ASX: DNK) was previously known as South Boulder Mines Limited (ASX: STB). The change of name occurred in June 2015 and reference to the region and commodity (Danakil Potash). We believe it is a good fit with our future.

Listed in 2003, DNK’s primary focus was on gold, nickel and base metal exploration within the Duketon Project in Western Australia. In 2008, DNK added Western Australian potash and phosphate to its portfolio of Projects in recognition of the strong demand outlook for fertiliser commodities and the search for a more significant project continued.

In 2009, the company was granted the exploration rights for the Colluli Potash Project in Eritrea, East Africa. Colluli had the potential to host a world class potash deposit and drilling began in 2010. The initial development path pursued the production of Potassium Chloride (MOP) and in 2011, to allow focus on the Colluli Project, DNK announced its intention to demerger all non-potash projects into a separate entity, Duketon Mining Limited (ASX: DKM) with the eventual demerge occurring in 2013. At this time, in response to changes in management, DNK considered the production of Potassium Sulphate (SOP) as a way to significantly improve economics through the production a premium potash product with lower operating costs, through resource optimisation, and a reduced development capital requirement as part of a modular approach to the Project.

The highly favourable PFS results were announced in early 2015 and the Definitive Feasibility Study (DFS) expected for delivery in calendar year 2015, is well advanced.

Board Composition and ExperienceThe board composition provides the experience and expertise in key areas to facilitate and control the progression of DNK’s 50% ownership of the Colluli Potash Project in Eritrea, East Africa:

Mr Seamus Cornelius (Non-Executive Chairman) is a corporate lawyer with significant experience in cross-border transactions, particularly in the resources sector. Based in Shanghai and Beijing since 1993, Seamus has over 20 years’ experience in legal and commercial negotiations with a strong focus on advising global companies on Chinese investments and Chinese state-owned entities on their investments in overseas resource projects.

Mr Paul Donaldson

(Chief Executive Officer & Managing Director) has extensive operational, technical marketing and supply chain management experience from a series of senior management roles spanning more than 20 years within BHP Billiton (“BHP”). Paul also holds a Masters Degree in Business and Technology from the University of NSW and a degree in Chemical Engineering from the University of Newcastle.


Mr John Fitzgerald (Non-Executive Director)

has extensive project finance experience through positions at NM Rothschild and Sons, Investec Bank Australia, Commonwealth Banks and HSBC Precious Metals. John is also Managing Director of Optimum Capital Pty Ltd, a corporate debt and advisory business focused on the mining sector.

Mr Tony Kiernan

(Non-Executive Director) has over 25 years of experience in the mining industry and was previously a commercial lawyer. He brings particular skills in the areas of Government relations and approvals (including Eritrea), corporate strategy and corporate governance.

Mr Liam Cornelius

(Non-Executive Director) is a geologist with nearly 20 years’ experience in the exploration industry across Australia, Asia and Africa. As a founding member of Danakali Ltd, Liam has played a key role in outlining areas of interest for the Company.

The board is supported by a strong management team:

Mr James Durrant

(Project Manager) has tertiary qualifications in both mechanical and mining engineering and brings project management, organisational design and operational management of large scale open cut mines skills to the organisation. James joined Danakali after a series of operational roles within BHP Billiton.

Mr Zeray Leake

(Country Manager)is a Geologist with over 12 years’ experience in the development and exploration of potash, gold, base metals and industrial minerals. Zeray previously worked for the Geological Survey of Eritrea.

Mr Stuart Tarrant (Head of Finance) has over 15 years’ experience in the accounting profession, most of which has been managing finance in companies experiencing accelerated growth or change. Stuart joined Danakali after a series of roles within BHP Billiton.

Mr Gordon Tainton (Head of Market Development) has over 25 years’ industry experience, with senior management roles in the physical commodity industry. Key areas of experience include; fertilisers, bulk commodities and logistics, marketing, sales and commercial. Gordon holds a BA in Georgaphy which focussed primarily on Geology and Transportation.


About the Colluli Mining Share Company

All Eritrean mines require a Joint Venture structure with the Eritrean National Mining Company (ENAMCO). Danakali and ENAMCO each own 50% of the Colluli Mining Share Company (CMSC) and CMSC owns 100% of the project. CMSC has a Board of 5 being 3 members from DNK and 2 from ENAMCO.

CMSC will seek to fund the initial project development costs with a mixture of debt (up to 70%) and equity. Any shortfall in the debt component will be underwritten by Danakali on market terms with repayment and security consistent with third-party debt. The 30% equity component is DNK’s obligation of which 50% is contributed through an Interest Free Loan.

After CMSC’s third-party debt is serviced, 50% of the funds available for distribution will be preferentially repaid to DNK to settle the interest-free loan. This preferential payment to Danakali occurs until such time as the

interest-free loan is repaid. The remaining 50% of CMSC’s funds available will be distributed evenly across the JV ownership. After this, available CMSC funds are distributed as per the JV.

Once production commences at Colluli, both JV partners will contribute equally to ongoing project costs through the JV company CMSC.


Eritrea and the Mining IndustryEritrea, located in the Horn of Africa, is a relatively new country with UN recognition in 1993. It is bordered to the northeast and east by the Red Sea, Sudan to the west, Ethiopia to the south/south west and Djibouti to the south/south east.

The nation has a total population of approximately 4 million people and Eritrea’s capital, Asmara, is home to over 600,000 inhabitants. Asmara was chosen as a capital for its salubrious highland climate, reliable water supply and ideal geographic location in the centre of Eritrea. Asmara’s architecture has been strongly influenced by a large Italian presence in the city through the late 1800’s to early 1900’s. The capital has perhaps one of the most concentrated and intact assemblage of Modernist architecture anywhere in the world.

The Eritrean economy has experienced considerable growth in recent years largely through commencement

of full operations at the Bisha copper-gold mine and the production of cement in the port city of Massawa. Real GDP is estimated at $4.4 billion with an annual growth rate of approximately 10%.

Eritrea has an extensive amount of resources such as copper, gold, granite, marble, and potash. In addition to the active Bisha mine, Zara Gold are currently commissioning their operation and Asmara Gold are pursuing funding options for their development.

Eritrea has well developed transportation infrastructure and has continued asphalting new roads, and improving its port facilities over the past decade. A coastal highway of more than 500 km connects Massawa with Asseb, providing access along the entire Red Sea coastline of Eritrea. Eritrea can be accessed by Qatar air, Egypt air, Eritrean airlines, Turkish airlines and Fly Dubai.

Asmara City, Eritrea


How to Invest Danakali Limited is listed in the Australian Stock Exchange (ASX: DNK) and shares can be bought and sold on the market. You can buy as little as $500 worth of shares. As with any investment, shares carry risk and investors need to inform themselves of these.

By investing in DNK shares on the ASX you are buying part ownership of the company. You can buy and sell shares by using a licensed broker on your behalf. For more information on how to trade in ASX shares please visit ASX’s online resources via www.asx.com.au/education/shares-courses.htm.

Investors located in Northern America have access to the American Depository Receipts Program (ADR). The Bank of New York Mellon sponsors DNK's Level 1 ADR which are traded on the over-the-counter (OTC) securities market in the US under the symbol: SBMSY and CUSIP: 836709105. One ADR represents one ordinary share in DNK.

US OTC Market information is available here: http://www.otcmarkets.com/stock/SBMSY/quote

DNKs ADR information can also be viewed here:http://www.adrbnymellon.com/dr_profile.jsp?cusip=23585T101

ADR Holders seeking information on their shareholding should contact:

LONDON NEW YORK HONG KONGMark Lewis Kristen Resch Herston [email protected] [email protected] [email protected] +44 207 163 7407 Telephone +1 212 815 2213 Telephone +852 2840 9868

Further Information Further information may be obtained from the company website: www.danakali.com


Forward Looking Statements and Disclaimer

The information in this investor pack is published to inform you about Danakali Limited (the “Company” or “DNK”) and its activities. DNK has endeavoured to ensure that the information in this presentation is accurate at the time of release, and that it accurately reflects the Company’s intentions. All statements in this presentation, other than statements of historical facts, that address future production, project development, reserve or resource potential, exploration drilling, exploitation activities, corporate transactions and events or developments that the ‘Company expects to occur, are forward-looking statements. Although the Company believes the expectations expressed in such statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in forward-looking statements.

Factors that could cause actual results to differ materially from those in forward-looking statements include market prices of potash and, exploitation and exploration successes, capital and operating costs, changes in project parameters as plans continue to be evaluated, continued availability of capital and financing and general economic, market or business conditions, as well as those factors disclosed in the Company’s filed documents.

There can be no assurance that the development of the Colluli Project will proceed as planned. Accordingly, readers should not place undue reliance on forward looking information. Mineral Resources and Ore Reserves have been estimated using the Australian JORC (2012) Code (‘JORC 2012’). To the extent permitted by law, the Company accepts no responsibility or liability for any losses or damages of any kind arising out of the use of any information contained in this presentation. Recipients should make their own enquiries in relation to any investment decisions.

Material resource and financial assumptions made in this presentation are consistent with assumptions detailed in the Company’s ASX announcements dated 25 February 2015, 4 March 2015 and 19 May 2015, which continue to apply and have not materially changed. The Company is not aware of any new information or data that materially affects assumptions made.

Resource Statement

Colluli has a JORC 2012 compliant Measured, Indicated and Inferred Mineral Resource estimate of 1,289Mt @11% K20. The resource contains 303Mt @ 10.98% K20 of Measured Resources, 951Mt @ 10.89% K20 of Indicated Resources and 35Mt @ 10.28% K20 of Inferred Resources.

The information relating to the Colluli Mineral Resource was compiled by Mr. John Tyrell, under the supervision of Mr. Stephen Halabura M. Sc. P. Geo. Fellow of Engineers Canada (Hon), Fellow of Geoscientists Canada, and as a geologist with over 25 years’ experience in the potash mining industry.

Mr. Tyrell is a member of the Australian Institute of Mining and Metallurgy and a full time employee of AMC. Mr. Tyrell has more than 25 years’ experience in the field of Mineral Resource estimation.

Mr. Halabura is a member of the Association of Professional Engineers and Geoscientists of Saskatchewan, a Recognised Professional Organisation (RPO) under the JORC Code and has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the JORC Code).

Mr. Tyrell & Mr. Halabura consent to the inclusion of information relating to the Resource Statement in the form and context in which it appears.

Reserve Statement

Mark Chesher is the Competent Person for the 2015 Colluli Ore Reserve estimate, and supervised preparation of the Ore Reserve estimate with assistance from specialists in each area of the study. Mr. Chesher is a Fellow of the Australasian Institute of Mining and Metallurgy, a Chartered Professional, and is a full-time employee of AMC Consultants Pty Ltd.

He has sufficient open pit mining activity experience relevant to the style of mineralisation and type of deposit under consideration to qualify as a Competent Person as defined in the JORC Code 2012. Mr Chesher consents to the inclusion of information relating to the Ore Reserve in the form and context in which it appears.

In undertaking the assignments referred to in this investment pack, AMC Consultants Pty Ltd acted as an independent party, has no interest in the outcome of the Colluli Project and has no business relationship with Danakali Ltd other than undertaking those individual technical consulting assignments as engaged, and being paid according to standard per diem rates with reimbursement for out-of-pocket expenses. Therefore, AMC Consultants Pty Ltd and the Competent Person believe that there is no conflict of interest in undertaking the assignments which are the subject of this statement.


DANAKALI LTDGround Floor

31 Ventnor AvenueWest Perth WA 6005

Telephone: +61 8 6315 1444Facsimile: +61 8 9486 7093

Email: [email protected]: www.danakali.com

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