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Salt Lake Potash and Mitsubishi enter MoU for offtake arrangement

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World Fertilizer,

Salt Lake Potash has announced that it has entered into a memorandum of understanding (MoU) with Mitsubishi Australia Ltd and Mitsubishi Corp., setting out the basis for the first offtake agreement for the Goldfields Salt Lakes Project (GSLP).

The offtake agreement will reportedly provide Mitsubishi with sales and offtake rights for up to 50% of the sulfate of potash (SOP) production from a demonstration plant at the GSLP for distribution into Asia and Oceania, as well as potentially other markets.

In the statement, Salt Lake Potash claims that it is progressing its GSLP development strategy, initially involving construction of a demonstration plant, producing up to 50 000 tpy of high quality SOP, with plans to distribute production through a small number of global distribution partnerships.

The Mitsubishi MoU is non-binding and sets out the key terms for a subsequent offtake agreement as the demonstration plant is developed. As well as quantities and target markets, other terms of the MoU include the following:

  • Market pricing and commission mechanisms.
  • Specifications and delivery parameters.
  • Mitsubishi to provide strategic advice on marketing within the region.
  • The parties to continue talks regarding funding needs for the GSLP.

The CEO of Salt Lake Potash, Matt Syme, said: “We are very pleased to have taken this important first step in establishing offtake and distribution channels for the Goldfields Salt Lakes Project. Our model of distribution partnerships is vital for what is essentially an export Project. Mitsubishi’s global preeminence in commodities trading and finance and longstanding involvement in Australian industry, give us great confidence that we can build a very cohesive and beneficial partnership over time. Their interest is a strong endorsement of the market outlook for SOP and also of our plans to supply these markets. We anticipate one or two more potential distribution agreements and we believe our patience in aiming for the very best channels and markets is the right approach.”

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