THE BOURSE WHISPERER: Australian Potash (ASX: APC) signed a second non-binding Memorandum of Understanding (MoU) for the supply of SOP (Sulphate of Potash) from the company’s Lake Wells project in Western Australia.
Australian Potash inked the new MoU with Hubei Agricultural Means of Production Group Co Ltd (Hubei-Agri) for sales of up to 100,000 tonnes per annum of SOP and comes on the heels of the MoU signed with Sino-Agri Holdings Company Limited (Sino-Agri).
Hubei-Agri is one of the largest provincial fertiliser distributors and importers in China.
The company said the signing of a second MoU strengthens its position as it seeks to place itself in large regional markets, to supplement primary sales into the domestic Australian market.
The Lake Wells feasibility study is progressing and as it does, APC intends to maintain an active dialogue with selected regional off-take partners and identified potential domestic customers
The company believes this early engagement will facilitate product trials, optimise product specifications and ultimately seek to progress to a binding commercial agreement.
“Through the network that APC is beginning to develop within the mainland China potash industry, we have again been successful in executing an MoU with Hubei-Agri around supply of Lake Wells SOP,” Australian Potash executive chairman Matt Shackleton said in the company’s announcement to the Australian Securities Exchange.
“We have also begun expanding our network in China to consider areas such as equipment design and procurement.
“We will shortly commence our feasibility program and are aiming to optimise capital expenditure estimates through a close engagement with potential suppliers.”