Kore Potash plc, a UK-based potash development company, provided an update on its Engineering, Procurement, and Construction (EPC) negotiations. The company has a 97% ownership in the Kola and DX Potash Projects, situated in the Republic of Congo’s Sintoukola Basin. The latest developments were shared in an announcement on June 24, 2024.
Quarterly Activities Report Confirmation
Kore Potash confirmed in its Quarterly Activities Report on April 29, 2024, that PowerChina International Group Limited delivered their EPC proposal and draft contract on February 6, 2024. The company had previously indicated that detailed negotiations with PowerChina had begun, targeting the signing of the full EPC documentation by Q2 2024.
Progress in Negotiations
Negotiations have progressed, with key discussions held between Kore Potash and PowerChina in Beijing in early May 2024. Despite significant progress, the high complexity of the Kola project has necessitated further discussions. The project involves underground mining, processing, and offshore transhipment, requiring input from specialist engineers, financiers, and lawyers.
Complex Issues and Further Discussions
Recent discussions have raised critical issues around completion and performance guarantee tests. These need further deliberation with PowerChina. A subsequent session is planned for early July 2024, to be held either in Beijing or Dubai. Additionally, PowerChina has shown interest in operating the mine post-construction, with a draft Operating proposal expected in July 2024.
Funding Requirements
Kore Potash had announced on March 28, 2024, the need to raise additional funds for working capital until the full EPC documentation is signed. This funding is also necessary to support the financing proposal for the complete construction of the Kola project from the Summit Consortium.
Conclusion
Kore Potash is making significant strides in its negotiations with PowerChina. Despite the complexity, the company remains committed to finalizing the EPC contract. The Kola project is poised to become a major player in the global potash industry, with substantial progress expected in the coming months.