- Potash company Danakali said Thursday narrowed first-half losses amid signs of progress at its Colluli potash project in Eritrea, East Africa.

For the six months ended 30 June 2018, the company reported a loss before tax of $1.11m, compared with a loss of €4.87m a year earlier.

Danakali and the Eritrean National Mining Corporation have a 50:50 joint venture in the Colluli Mining Share Company -- the 100% owner of Colluli.

The company said it made progress on its main goal of advancing the Colluli potash project; It secured the necessary financing and commenced development of the project.

The company also confirmed a post-tax project net present value of US$902M and post-tax internal rate of return of 29.9% for Colluli.

'We have made significant progress in the first half of this year, achieving key milestones on the path to securing the necessary financing and commencing development of the Colluli Potash Project, including confirming a take-or-pay offtake agreement for up to 100% (minimum 87%) of Colluli Module I SOP production with EuroChem and listing on the LSE Main Market in July,' said Danakali Executive Chairman, Seamus Cornelius.

'We have also made good progress on the development of operational and in-country readiness systems and structures, which puts us in a good position to commence the next stages in the project development on completion of financing.'

'We are pleased to see that SOP demand growth continues to outpace low cost supply growth, resulting in a robust pricing environment, and welcome the significant positive developments in Eritrean-Ethiopian relations including the peace treaty signing, which provides a platform of stability for the region.'

At 8:38am: [LON:DNK] Danakali Limited share price was 0p at 43.5p

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