Trigg Mining is set to directly benefit from $678 million in state and federal government funding earmarked to upgrade “The Outback Way”.
Touted as Australia’s longest shortcut, The Outback Way carves a well-worn 2,700 kilometre track through the heart of Australia from Laverton in Western Australia all the way to Winton in Queensland, passing through the heart of the Northern Territory’s red centre.
The Government funding will be used to seal the road extending from 40km east of Laverton to the Western Australian-Northern Territorian border. The newly bituminised stretch of road will pass through Trigg’s tenure connecting the company’s developing Lake Throssel potash project, located about 170km northeast of Laverton, with key domestic and international export markets.
Trigg Mining Managing Director and CEO, Keren Paterson said: “The Australian and WA governments recognise the strategic significant of Sulphate of Potash as a fertiliser with the potential to improve soils, water quality and carbon farming opportunities in Australia and globally and the development of this vital piece of national infrastructure will support Trigg’s ambition to develop the Lake Throssell Project.”
The company says work is already underway on the road with previous funding allocated to seal the first 147km by mid-2026. The additional funding will ensure works on the road in WA will be completed by the end of the decade.
Trigg delivered a robust scoping study in October last year evaluating the proposed development of its Lake Throssell sulphate of potash, or “SOP” fertiliser project. The company says the project could generate nearly $100m a year in EBITDA over an initial 21-year mine life.
Trigg has defined an impressive ‘drainable’ mineral resource at Lake Throssell taking in 14.4 million tonnes of SOP grading 4,655 milligrams per litre potassium, or 10.6 kilograms per cubic metre potassium sulphate.
Production at Lake Throssell is anticipated to involve harvesting of saline brine water from subterranean aquifers. In turn, solar evaporation of the brine will generate a naturally forming SOP for use as a fertiliser and other industrial purposes around the world.
The company plans to produce an estimated 245,000 tonnes of SOP per annum using the primordial process of evaporation generating an average annual revenue of $180 million.
It has also estimated a pay-back period of just 4.5 years for an initial $378 million capital outlay. Average cash operating cost per tonne of SOP clocked in at about $341, with an all-in sustaining cost of $372 per tonne.
A net present value of $364 million with an internal rate of return of 18 per cent were also estimated in the scoping study.
The study was based on a mid-2021 granular SOP price of US$550 per tonne. Higher crop prices, supply constraints and strong global demand have seen prices surge recently to over US$900 per tonne.
Trigg recently topped up its coffers by a cool $4 million to $7 million courtesy of an oversubscribed share placement. The new funds are earmarked to progress the company’s pre-feasibility study valuating the production of SOP at Lake Throssell. As the company progresses down the pathway to development, it should be a sweet ride for Trigg along The Outback Way against the felicitous backdrop of strengthening global potash prices.
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By Matt Birney
