PROSPECTIVE Western Australian Sulphate of Potash (SoP) fertiliser producer Australian Potash Ltd (APC) has signed a third offtake agreement for its premium K-Brite product.
APC on Monday informed the Australian Securities Exchange (ASX) it has a five-year deal with a three-year extension option signed with Mitsui & Co, one of the world's largest trading and investment companies, to take 30,000 tonnes of K-Brite SoP fertiliser per annum.
Mitsui & Co will have exclusive right to distribute K-Brite through Asia, except for China which is covered by another offtake agreement.
APC told the ASX the latest deal meant 100,000tpa of its estimated 150,000tpa SoP fertiliser production at Lake Wells, a remote salt lake 200 kilometres north east of Laverton in the Goldfields, was now committed under a binding agreement.
Its offtake agreements with Redoxi, Migaoii and Mitsui now cover K-Brite distribution throughout Australia, New Zealand, China and Asia, it said.
APC managing director and chief executive officer Matt Shackleton said discussions were "well advanced" on further agreements for distribution throughout Europe and the Americas.
The agreement with Mitsui is based on net realised price which APC said would "incentivise" Mitsui to achieve the highest possible sales price for K-Brite in Asian markets.
As previously reported in Farm Weekly, APC supplied K-Brite samples for two-year field trials and laboratory trials in WA which conclude with this season's harvest.
"Mitsui & Co are a titan in the world's major fertiliser, logistics and distribution sectors and the marketing and distributorship of SoP is integral to their brand presence in Asia," Mr Shackleton said.
"It is enormously gratifying that APC's K-Brite brand will be traded through the Mitsui network in these lucrative and growing Asian markets.
"We are now working to finalise the last part of the offtake program.
"In addition to that, we continue to progress along the approvals pathway, with firm dates now agreed with the EPA (Environment Protection Authority) and the financing program."
APC is one of only three out of a number of WA companies looking to exploit hypersaline brine beneath remote regional salt lakes to produce SoP fertiliser for domestic and international markets, to have completed a definitive feasibility study (DFS) on its project.
A fourth prospective SoP fertiliser company, Agrimin (AMN), is expected this month to announce the results of a DFS on its Lake Mackay project on the WA-Northern Territory border.
As Farm Weekly went to press trading in AMN shares was halted ahead of an impending announcement which was expected to be the DFS results.
Lake Mackay is WA's biggest salt lake by area and AMN potentially has rights to Australia's largest SoP deposit.
Last week Trigg Mining (TMG) told the ASX it had started a helicopter-supported 24-hole shallow drilling program to 12 metres across the surface of Lake Throssell, another salt lake 170km east of Laverton, in its search for suitable grade SoP to produce fertiliser.
Earlier this month Salt Lake Potash (SO4), the company most likely to be first into commercial production of Australian SoP fertiliser in the first quarter next year from its fast-tracked Lake Way project near Wiluna, told the ASX it was on track with 90 per cent of its production equipment procurement completed or contracted.