Verde Potash has completed a pre-feasibility study (PFS) for the production of ThermoPotash (TK) in Brazil.
AMEC, Andes Mining Services and NCL Ingeniería y Construcción prepared the PFS on the company's Cerrado Verde project in Minas Gerais state, Brazil.
The PFS estimated project capital costs of $113.6m, including $14.7m in contingency for 1,000t per day of TK production.
The plant is expected to have an internal rate of return of 23.5%, with an estimated payback of the initial capital after five years.
Sustaining capital is estimated to be $31.5m over a projected 31-year mine life.
According to the PFS, the estimated operating costs with production, workforce and other variable costs would be $47.12 per tonne, in addition to the estimated administrative and marketing costs of $8.18 per tonne, making a total of $55.29 per tonne of TK.
Verde Potash president and CEO Cristiano Veloso said a $113m Capex is a realistic business proposition for the current market.
"Verde expects to continue working with the Brazilian Government through Inova Agro, the government's special financing programme, in order to reduce Brazil's debilitating dependency on Russian and Canadian potash," Veloso said.
The company said the PFS supports its positive outlook on Cerrado Verde's value and represents a milestone towards the development of the project.
Verde limited the production rate to 330,000t a year of TK and NCL prepared the mineral reserve estimate for the project.
Cerrado Verde is the source of a potash-rich deposit from which the company aims to produce both TK and potassium chloride.
Verde Potash is also developing its Calcario limestone project; limestone being a key raw material in the company's process to produce both TK and potassium chloride.