Potassium ore exploration in Laos is expected to be developed ahead of plan

In order to speed up the implementation of the development of the exploration site, a key new mining project in Khammuan, the Department of Geology and Minerals of the Ministry of Energy and Mines organised a Work Promotion Seminar in Thakhek district on July 17 on the Potassium Ore Exploration Agreement in Nonglome village of Nongbok district.

This seminar was specially organised by the Ministry of Energy and Mines based on the rapid progress of the implementation of the agreement by Asia-Potash International and to further accelerate the subsequent upgrading of mining rights.

During the seminar, the Department of Geology and Minerals provided a detailed introduction to the development project and the contents of the agreement to relevant departments, with a focus on assigning the work responsibilities of each department to provide support for the rapid and efficient progress of the project.

Based on the conventional experience of Laos’ potassium ore industry, it usually takes three to five years for a company to obtain exploration rights and complete all related work, such as exploration, feasibility study, and environmental and social impact assessment.

With this agreement, Asia-Potash International has promised the Lao government to complete all the necessary work for upgrading the mining rights within two years. It plans to complete the preparation and review of the exploration report in the first year, and the preparation and review of the feasibility study report and environmental and social impact assessment report in the second year.

During the actual implementation of the agreement, Asia-Potash International further reduced the work cycle significantly, completing all geological exploration work within six months after signing the agreement and preparing the detailed exploration report, greatly shortening the exploration cycle.

This means that the mining rights are expected to be upgraded from exploration rights to mining rights one year ahead of schedule, and the entire project will enter the development phase a year ahead of schedule, releasing the economic value of potassium ore in advance.

The Deputy Director of the Department of Geology and Minerals, Khaophone Souklaphan, said the overall exploration work of Asia-Potash International is advancing rapidly. After signing the agreement, Asia-Potash International cooperated with relevant departments of Khammuan to carry out exploration and drilling work on the site. It took only 106 days to complete all 36 drilling holes, detect the reserves of potassium ore resources, carry out geological structure research, and collect land use data in the area.

The company completed the exploration work within the one-year exploration period specified in the contract, indicating that the company has financial strength and an experienced technical team. The company has currently completed the compilation of all exploration data and geological information and submitted the detailed exploration report to the Department.

In April 2022, Asia-Potash International began to apply for mining rights of potassium ore in Nonglome village. The company stood out in the fierce competition among seven enterprises with its built capacity advantages of one million tonnes of potash fertiliser, technological pioneering advantages and the core concept of boosting the economic development of Laos.

On November 28, 2022, the government and the company officially signed the agreement. At this point, Asia-Potash International owned mining rights for 214.8 square kilometres of potash ore and exploration rights of 48.52 square kilometres for potassium ore in Laos, with an expected one billion tonnes of resource reserves of purified potassium chloride. This laid a solid foundation for the company to become a world-class potash supplier and build Laos into the world’s fourth-largest potash fertiliser production base.

Khaophone said, “While conducting exploration, Asia-Potash International paid attention to protecting the ecological environment and adopted targeted environmental protection measures to avoid any impact on the land and ecosystem of villagers. After completing the exploration, drilling and collection of samples, the workers backfilled the holes and sealed them with cement mortar to restore the surface to its original state and to ensure normal use by the villagers. During the drilling process, the company fully paid attention to the demands of relevant national departments, village committees and the masses, and provided timely and sufficient compensation to the villagers in the drilling area.”

He added, “In addition, the company provided employment opportunities for villagers, improved their living conditions and maintained harmonious development between the company and individuals, as well as society and the environment. It is hoped that Asia-Potash International can promote the early completion and operation of 48.52 sq km of potassium ore, and bring more economic and social benefits to Khammuan.”

The Deputy General Manager of Laos Potash Fertiliser Base of Asia-Potash International, Zhu Xiangli, said the unexpected progress of the project will release huge economic and social benefits. If the project is completed one year ahead of schedule, it can pay an additional US$30 million in taxes to the Lao government, and this will make the project’s output value increase by more than US$1 billion and provide more than 5,000 job opportunities.

The project will also have a strong economic driving effect, which can fully power the development of commerce, retail, transportation and other industries in the surrounding areas.

The booming mining industry is becoming an important force for Laos to attract foreign investment and for development in the industry. But the nonstandard implementation and lack of management and supervision of mining in the past have caused many problems.

For example, some developers or investors have delayed exploration and exploitation, defaulted on contracts, resold projects, and caused social and environmental impacts, and all this has resulted in serious damage to national assets.

Recently, the Fifth Regular Session of the 9th National Assembly announced the review results of the National Ten-Year Mineral Development Strategy (2021-2030) and the 2035 Vision, and emphasised once again, “For the approval of mineral development projects, we must choose reliable, experienced and skilled large companies to invest according to the actual situation.”

It is understood that compared to Asia-Potash International’s unexpected capability to immediately start construction and complete exploration within six months of signing the agreement, other foreign-funded enterprises that obtained exploration rights earlier only started exploration after more than a year of preparation. Based on its outstanding resource planning and performance capability, rich experience in project construction and strong technological innovation capability, Asia-Potash International was selected by the government to develop 48.52 square kilometres of potassium ore in Khammuan.

Asia-Potash International is the first company in Laos to achieve industrial production of potash fertiliser, and also the first to achieve a production capacity of one million tonnes. It has become the largest potash fertiliser supplier in Southeast Asia. Currently, the company is maintaining the speed of “adding one million tonnes per year” and is expected to achieve the second one-million tonne project reaching design capacity, and the third one-million tonne project being put into operation within the year.

It plans to achieve a potash fertiliser production capacity of five million tonnes by around 2025 and achieve a medium to long-term goal of seven to 10 million tonnes. On this basis, the company attaches importance to the comprehensive development and utilisation of associated mineral resources and extends the development of upstream and downstream industrial chain projects of potash ore through investment promotion.

The Khammuan Circular Industrial Park project, jointly promoted by the company and the Government, is expected to greatly drive local industrial development and urbanisation, and further promote local economic development and employment.

The mineral and chemical processing industry has been designated as one of the eight priority industries in the national processing industry development plan for 2021-2025. For precious mineral resources, Laos should strengthen management in a prudent manner, and identify and introduce capable, responsible and result-oriented development enterprises. Relevant government sectors should accelerate the development of potential projects and release value and transform mineral resources into economic value so that the country can earn more foreign exchange, the government’s financial income increases and local development can be boosted, since all of this will contribute to economic development and the people’s well-being.

The Vientiane Times

Asia News Network