Omari Gates
Australia is on the verge of entering its first years of potash production, with a number of projects underway across the country. Previously, Australia relied on imports of potassium from Canada, the Middle East, and Europe, with Australian farmers consuming a quarter of a million tonnes of potash each year. However, in 2019, Australian Potash produced the country's first-ever potash at its processing plant in Canning Vale, south of Perth, and Kalium Lakes became the first mining company in Australia to produce SOP in October 2022.
| Characteristics | Values |
|---|---|
| First potash mine in Australia | Beyondie project in Western Australia |
| First potash producer in Australia | Kalium Lakes |
| Year of first potash production in Australia | 2019 |
| Annual production capacity of the first potash mine | 90,000 tonnes |
| Mine life | 30 years |
| Investment cost | $216 million |
| Location of the processing plant | Canning Vale, south of Perth |
| Purity of the produced potash | 98% |
| Potassium oxide (K2O) content | 53% |
| Potash type | Sulphate of potash (SOP) |
| Alternative potash type | Muriate of potash (MOP) |
| MOP sales record in Australia | 14-year high in 2018 |
| Countries Australia imports potash from | Canada, the Middle East, and Europe |
| Annual potash consumption in Australia | 250,000 tonnes |
| Australian companies in the race to produce SOP | At least four |
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What You'll Learn
Kalium Lakes' Beyondie project in Western Australia
The Beyondie project is spread across approximately 2,400 square kilometres of granted mining tenure, extending into the Little Sandy Desert. The site is underpinned by a high-grade brine deposit containing potassium and sulphate ions, which can form potassium sulphate salt. The brine is primarily found below a lake surface and in adjacent sediments, with a superior brine grade and sodium to potassium ratio compared to its competitors.
Kalium Lakes received board approval for full-scale construction in October 2019, marking a pivotal moment in the company's history. The project has also secured significant funding, including a $72 million capital raise, loan facilities totalling $176 million from KfW IPEX-Bank and Northern Australia Infrastructure Facility, and a $15 million working capital facility from Westpac.
The Beyondie project is expected to have a 30-year mine life, producing around 90,000 to 164,000 tonnes of SOP annually. This production capacity will contribute to Australia's self-sufficiency in potash, a vital fertiliser for the country's agricultural industry. The project has also received support from traditional owners, the Gingirana and Birriliburu People, who performed a welcome to country ceremony on-site.
With its final investment decision and funding in place, Kalium Lakes is well-positioned to become Australia's first producer of SOP, giving the company a head start in the domestic potash market.
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Australia's first sulphate of potash (SOP) mine
SOP is a premium grade fertiliser used for chloride-sensitive crops, including fruits, vegetables and tree nuts. There is currently a worldwide shortage of SOP. Of the global market, SOP made up just under 10% of the 71 million tonnes of fertiliser produced in 2019, with the balance being Muriate of Potash (MOP), a cheaper, chloride-heavy fertiliser, which increases the level of salt in the soil where it's used. Both MOP and SOP help increase crop yields, in turn helping to reduce food poverty and global hunger.
Agrimin, headed by Mark Savich, is as little as a year away from starting construction on a SOP mine site at Lake Mackay in Western Australia. It's Australia's largest salt lake and the largest known deposit of brine-hosted SOP in the world. The site will include an A$270 million processing plant and enough wind and solar renewable energy infrastructure to generate 75% of the plant's power needs as soon as production begins – likely to be in late 2024 or early 2025. Production of brine-hosted SOP is also the most cost-effective and environmentally sensitive form of the fertiliser. The more common Mannheim process centres on the reaction of potassium chloride and sulphuric acid, which requires furnaces heated to 600°C and generates hydrochloric acid as a by-product. Agrimin's site is forecast to be the lowest-cost SOP mine in the world.
Agrimin's development time has been well spent, building a relationship with the Indigenous traditional owners of the lake and signing a landmark native title agreement in 2017 to allow the project to proceed. The logistics operation will involve 25 high-tech road train trucks, worth A$1 million each, and a 940-kilometre sealed road through the Gibson Desert and the Kimberley region, which Agrimin will build, to transport the processed SOP from the most remote mine site in Australia to a port on the far north coast of Western Australia at Wyndham.
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Australian soils' need for potash
Potash is a vital component of fertilizers, which helps to increase agricultural yields and feed the world's growing population. It is a natural substance that is constantly recycled in the earth. It is also a group of vital potassium-rich minerals that play an important role in nurturing the soil that feeds us. Potash is crucial for ensuring the pH level of the soil is stable, which allows for more crops to grow.
Australian farmers consume a quarter of a million tonnes of potash annually, but until recently, there was no domestic production of potash. Australia has previously satisfied its potassium needs through imports, with farmers paying about $1000 a tonne for potash, including import costs. However, the country is now investing in domestic potash production to provide a locally available and affordable nutrient source for growers.
Kalium Lakes became the first mining company in Australia to produce sulphate of potash (SOP) in October 2020 at the Beyondie project in Western Australia. The company is already looking at expansion, raising $50 million to boost its annual production from 90,000 tonnes per annum (tpa) to 120,000tpa. Several other companies are also vying to break ground in the domestic market.
Demand for potash is on the rise globally, with a particular demand for SOP in China and Asia, where food requirements are constantly increasing. As demand for quality fruits and vegetables grows, high-quality potash production is needed to improve crop qualities such as taste, appearance, and shelf life.
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Australian Potash's Lake Wells operation
The Lake Wells Potash Project (LWPP) is a palaeo-channel brine-hosted sulphate of potash (SOP) project in Yilgarn Craton, Western Australia. Australian Potash (APC) is the project developer. The project is expected to produce 14.7 million tonnes of SOP over 20 years of mine life, with the first stage expected to produce 150,000 tonnes of SOP per year during the first five years of operation. The project is expected to cost around $300 million to construct and will provide 80 jobs in steady-state operation.
The Lake Wells project is an important step towards Australia's self-sufficiency in providing locally extracted potash for its agricultural industry. Australian farmers consume a quarter of a million tonnes of potash fertiliser per year, but until recently, there was no domestic production of potash. The SOP product is considered a vital fertiliser by many farmers, helping to increase agricultural yields and improve soil quality.
The APC made a strategic decision in 2015 to pursue and adopt an accepted processing methodology for the Lake Wells project. The asset will embrace a tried-and-tested flow sheet similar to those in operation in the US, Egypt, Jordan, and Israel. This decision aligns with APC's risk-reduction' approach to project development.
The Lake Wells project is also significant because it will generate SOP in a clean, green, and effective manner. APC aims to challenge China's dominance in the burgeoning potash market by becoming a major SOP producer in Western Australia. The project is expected to have a long-life production opportunity, with a mine life of over 30 years.
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Australia's first caesium deposit
Pioneer Resources, the company that discovered the deposit, received approval to develop the Sinclair Caesium Mine in early 2017. The mine is part of the company's Pioneer Dome project in Western Australia's eastern goldfields. The maiden mineral resource estimate for the Sinclair deposit included 10,500 tonnes of pollucite ore, with a grade of 17.1% caesium oxide.
The discovery of the Sinclair Caesium Deposit is significant as there are only a few other commercial-sized pollucite deposits globally. The Bernic Lake Mine or Tanco Mine in Canada, the Bikita Mine in Zimbabwe, and now the Sinclair Mine are the only three mining operations that have produced commercial quantities of pollucite. The formation of pollucite is rare and occurs only in extremely differentiated lithium-caesium-tantalum (LCT) pegmatites.
The development of the Sinclair Caesium Mine by Pioneer Resources will contribute to the production of caesium formate brine, which is essential for the oil and gas industry. The company has also entered into a partnership with Canada's Cabot Corporation, which operates the Tanco Mine, for the sale and purchase of pollucite ore extracted from the Sinclair Mine.
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Frequently asked questions
Australia has previously relied on imports of potassium, but is now becoming a hub for potash production, with several projects underway in Western Australia.
Kalium Lakes was the first mining company in Australia to produce SOP in October 2020. The product was made at the Beyondie project in Western Australia.
SOP stands for Sulphate of Potash. It is a high-value alternative to MOP (Muriate of Potash) and is particularly well-suited to Australian soils.
Potash is a vital component of fertilisers, helping to increase agricultural yields and feed the world's growing population. It is also used to decrease the acidity of soils, which helps to improve the water-holding capacity of the soil.
Potash is derived from potassium salts. It is traditionally made from wood ash, but it can also be mined from underground deposits.
