ASX-listed Kalium Lakes has completed a “compelling” bankable feasibility study (BFS) for the Beyondie sulphate of potash (SoP) project, in Western Australia, prompting the board to approve early works and front-end engineering and design work ahead of a final investment decision.
The BFS delivered strong financial outcomes, with the pretax net present value estimated at A$575-million, with an internal rate of return of 20%. The project will have average earnings before interest, taxes, depreciation and amortisation (Ebitda) of A$116-million, yielding an Ebitda margin of 61%.
The company will invest A$159-million for an initial 82 000 t/y operation, which will ramp up to 164 000 t/y in a second phase costing A$125-million.
Beyondie will operate for 30 years and will be repaid in seven.
Kalium plans to fund the capital expenditure (capex) through a combination of up to 60% debt and residual equity. The company reported that it had progressed the process for debt financing with an initial due diligence completed and expression of interest term sheets received.
About A$42-million of the project capex would be able to qualify under the German Export Credit Agency scheme and has received a positive preliminary assessment decision by the German government inter-Ministerial committee and the Hermes export credit agency.
Kalium has executed offtake term sheets with German fertiliser producer and distributor K&S for 100% of the Phase 1 output.
“Kalium Lakes is proud to be the first SoP developer to complete a BFS for an Australian deposit, which allows for an initial mine life of between 30 years to 50 years," said MD Brett Hazelden.