Salt Lake signs MOU offtake

Salt Lake Potash has signed a memorandum of understanding with Chinese fertiliser business Sinofert Holdings for an offtake agreement at the Perth-based company’s Goldfields salt lakes project.

The MOU sets out the basis for an agreement that would provide Sinofert with offtake rights for up to 50 per cent of all sulphate of potash production from the project.

The initial term is eight years, starting in 2020.

The MOU is non-binding and also includes market pricing, delivery parameters and marketing arrangements.

Listed on the Hong Kong Stock Exchange, Sinofert handles about 13 million tonnes of fertilisers each year.

The company is majority owned by state-owned entity Sinochem Corporation.

 “We are very pleased to have taken this important step to partner with Sinofert in further establishing distribution channels for the Goldfields Salt Lakes Project,” chief executive Matt Syme said.

“Our model of distribution partnerships is vital for what is essentially an export project and Sinofert is the leading participant in the world’s largest fertiliser market, where more than half of the world’s SOP is both produced and consumed.”

The company is planning to commence construction of a pilot plant at Goldfields soon.

The plant will have a capacity of 50,000 tonnes per annum.

Shares in Salt Lake finished up 6.67 per cent at 48 cents each today.