Australian Potash has executed a second offtake agreement for the supply of premium K-Brite sulphate of potash (SOP) from its flagship Lake Wells project in Western Australia.
The agreement covers an initial 10-year supply of 50,000 tonnes per annum of premium K-Brite SOP to Singapore-based Tier-1 company, Migao International, bringing Potash’s total offtake to 70,000 tonnes a year.
Last month, Australian Potash had signed agreement for the supply of 20,000 tonnes per annum of premium K-Brite SOP to Sydney-based chemicals and ingredients distributor, Redox.
Australian Potash chief executive Matt Shackleton said the new agreement allowed Australian Potash to supply into the world’s largest SOP market, China.
“From their position as one of China’s largest Mannheim SOP producers, Migao is ideally positioned to distribute the Lake Wells SOP K-Brite into their long-term supply chain relationships in China.”
Migao International produced over a million tonnes of specialty potassium fertilisers from its seven production facilities in China last year.
Under this agreement, Migao will retain sales and distribution rights for K-Brite in China.
The board of Australian Potash is also expected to make a final investment decision on the Migao offtake.
Shackleton said Australian Potash would continue progressing the offtake program despite restrictions on movement due to the coronavirus pandemic.
“Our strategic intention remains to secure the majority of the Lake Wells SOP output under offtake, with now 70,000 tonnes, or approximately 45 per cent of the targeted output of 150,000 tonnes per annum, agreed to,” he concluded.
“We look forward to updating shareholders presently on progress across the offtake program, permitting and approvals, and project financing.”