The offtake agreement with Redox includes K-Brite sales and distribution rights on an exclusive basis to Australia and New Zealand
Australian Potash has signed the first binding term sheet with Redox to supply 20,000 tonnes per year of sulphate potash from the Lake Wells sulphate of potash (LSOP) project located in Western Australia.
Located in Yilgarn Craton, Western Australia, the project is a palaeo-channel brine-hosted sulphate of potash (SOP) project which is developed by Australian Potash.
The offtake agreement with Redox covers sales and distribution rights to K-BriteTM in Australia and New Zealand.
Australian Potash managing director and CEO Matt Shackleton said: “We are pleased to announce the first binding term sheet for offtake supply, covering sales and distribution rights to K-BriteTM in Australia and New Zealand.
“Our new partnership with long-established Australian company Redox, who from its Sydney base has built broad trade relationships and an extensive global distribution network, delivers APC’s first step in the larger offtake program.”
Lake Wells sulphate of potash project is expected to have a 30-year mine life span
The terms of the Redox offtake agreement includes the pricing based on the market price minus traditional ‘net back’ costs including a marketing fee and ‘flow through’ shipping, storage and handling costs.
In August last year, Australian Potash has made a Definitive Feasibility Study (DFS) for the project and is now focusing on the Front-end Engineering Design (FEED) Study finalising offtake discussions and securing financing to develop the LSOP.
The project is expected to have a 30-year mine life span with a production capacity of 150,000 tonnes per annum of premium grade sulphate of potash using about 21% of the total Measured Resource estimate.
The firm is currently under discussions regarding the further Tier 1 off take agreements for other areas in the Americas, Europe, China and the rest of Asia.