2 PROJECT DESCRIPTION - ERM · 2 PROJECT DESCRIPTION ... obtained a mining license from the...

ENVIRONMENTAL RESOURCES MANAGEMENT YARA DALLOL BV

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2 PROJECT DESCRIPTION

This Chapter provides a description of the proposed Project and associated phases,

related activities and ancillary infrastructure. This Project description formed the

Terms of Reference for specialist studies associated with this ESIA.

The information presented in this Chapter was received from the ongoing

Definitive Feasibility Study (DFS) currently being completed by Novopro.

2.1 PROJECT LOCATION

Yara Dallol BV holds concession areas in the Danakil Depression in north-eastern

Ethiopia. The Project Area is approximately 605km northeast (NE) of the capital

of Addis Ababa and 388km northwest (NW) of the port of Djibouti (refer to Figure

1.1 in Chapter 1). The Yara Dallol BV concession areas are defined as (also refer to

Table 2.1 and Figure 2.1):

1. Musley: 10.1km2 (about 2km x 5km), under application for license for

exploration activities (1).

2. North Musley: 18.7km2 (about 4km x 5km, trapezoid shape), licensed for

exploration activities.

3. Crescent: 35.3km2 polygon, licensed for exploration activities.

(1) Please Note – Yara Dallol BV currently holds one exploration license for North Musley and Crescent Concessions (Reference

No.: MOM/0130-0134/2000) and is (as a result of the license lapsing) in the process of re-applying for an exploration license for

the Musley Concession. Moreover, once mineral resources have been verified and feasibility concerning the proposed Project

verified, Yara Dallol BV will be applying for mining rights for all three concessions (North Musley, Crescent and Musley). As a

result it is deemed appropriate to include the Musley Concession in the overall ESIA Study Area and to assess the likely social

and environmental impacts to sensitive receptors that occur within this area so as to suggest appropriate mitigation /

management measures.


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Table 2.1 Coordinates of the Yara Dallol BV Concession Areas in the Danakil Depression,

Ethiopia

Crescent Exploration

License Area

North Musley Exploration

License Area

Musley Mining

License Area

Corner

Easting

(m) Northing (m)

Easting

(m) Northing (m)

Easting

(m) Northing (m)

1 637472 1570413 628226 1581465 632807 1570088

2 633859 1579906 629949 1576367 631612 1574997

3 638489 1581590 629994 1576346 633590 1575415

4 638813 1581592 633332 1577691 634755 1570528

5 640876 1575907 631905 1582219

6 639558 1576435

7 638042 1575912

8 637659 1573867

9 638746 1570887

Please Note - coordinates are given in geographic format, UTM zone 37, hemisphere N of the Adindan, Ethiopia

datum (Ellipsoid: Clarke 1880)

Figure 2.1 Yara Dallol BV Concession Areas

Please Note - Yara Dallol BV is in the process of re-applying for an exploration license for the Musley

Concession, and as a result it is deemed appropriate to include the Musley Concession in the overall ESIA Study

Area.


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As such, the total area of all three concession areas is 64.1km2.

Yara Dallol BV is one of three concession holders within this area of the Danakil

Depression. The other concession holders are:

1. Allana Potash Corp. - Allana has completed feasibility study and has

obtained a mining license from the Ethiopian Ministry of Mines (MoM). They

are continuing with the development of a potash mining project.

2. G&B Central Africa Resources Plc - G&B is conducting exploration work in

their license areas. Exploration commenced with diamond core drilling in

May 2011.

These concession holders, together with their concession areas are illustrated in

Figure 2.2. This Figure provides context as to the location of these concession

areas, relative to the Yara Dallol BV concession, and within the broader region.

It must be noted that Yara Dallol BV has relinquished 25% of the Crescent

Concession (as required by the Ethiopian Mining Laws) that is occupied by

Mount Dallol (this is illustrated in yellow in Figure 2.2). The reason for this is to

ensure that no mining activities are undertaken on Mount Dallol or the

immediate surroundings.


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Figure 2.2 Concession Areas in the Danakil Depression

Please Note - Yara Dallol BV is in the process of re-applying for an exploration license for the Musley Concession, and as a result it is deemed appropriate to include the Musley

Concession in the overall ESIA Study Area

`


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2.2 PROJECT BACKGROUND

The Yara Dallol Potash Project has been ongoing since 2008. In May 2012, Yara

International obtained majority shares in the project; however, prior to 2012, the

majority shareholder of the Yara Dallol Potash Project was an Indian company,

Sainik Potash Private Ltd.

The early engineering work was completed by the Potash Consultancy Firm

Ercosplan. Ercosplan completed a Pre-Feasibility Mining Feasibility Study report

in September 2012, summarizing the work completed to that date.

A new project consultant team was assembled, and comprised of Novopro Project

Development and Management, and Agapito Associates, a firm specializing in

the design of underground mines, with extensive solution mining expertise.

After reviewing the data available from the 2012 Mining Feasibility Study, the

team completed a Scoping Study based upon a simplified and more site-specific

process, and prepared a preliminary design and associated project CAPEX and

OPEX estimates, corresponding to the new design proposed. This Scoping Study

was approved by Yara International, resulting in the initiation of a (Definitive)

Feasibility Study in September 2013, which is scheduled to finish in January 2015.

2.3 PHASES OF THE PROPOSED YARA DALLOL POTASH PROJECT

In general, mining projects are developed in the following set phases:

Exploration (ongoing);

Engineering Scoping Study

Pre-Feasibility Study

(Definitive) Feasibility Study

Preparation for Execution (bridge engineering, contracting etc.);

Execution (detailed engineering and construction);

Operation (mining); and

Decommissioning and Closure.

Each of these phases have a different combination of activities and the

commencement of each phase is dependent on the outcome and success of its

predecessor. It must be noted that the scope of the Project proposed, and the

associated ESIA study, relates to the construction, operation and

decommissioning and closure phases. However, the recommendations of the

ESIA study and management and mitigation measures in the associated social

and environmental management plans, will need to be taken into account during

the planning phase, as well as subsequent phases of the proposed Project.

The above-mentioned Project phases are discussed in this Section.


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2.3.1 Exploration Phase

To date, the proposed Project has performed a considerable amount of work on

the characterisation of resource within its concessions. This Section details the

exploration activities undertaken by Yara Dallol BV between October 2008 and

July 2014.

Geological Exploration

In total, 49 holes have been drilled to date. These drill holes targeted the

following deposit horizons (the configurations of the horizons typical for Musley

North Zone 1 are presented in Figure 2.3):

Sylvinite

Upper Carnallitite

Lower Carnallitite

Kainitite

Figure 2.3 Deposit Horizons

During the process of drilling and coring wells, core samples extracted from the

various mineralized horizons were analysed for their mineral content by a

geochemical laboratory and tonnage of extractable resources available for

Surface


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exploitation was estimated. The mineral resource estimate thus derived is a major

component in the evaluation of the overall economic feasibility of the proposed

Project. The results of exploration drilling activities to date are presented in Table

2.2.


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Table 2.2 Thickness and Average Grade of the Deposit Horizons in the Early Potash bearing Drill Holes for the Yara Dallol Potash

Project

Potash

Horizon

Thickness

(m)

Sylvite

wt%

Halite

wt%

Carnallitite

wt%

Kainite

wt%

Kieserit

wt%

Anhydrite

wt%

Polyhalite

wt%

Insolubles

wt%

KCl

wt%

Sylvinite Member (28 holes for calculation)

Average 3.35 27.83 57.19 3.92 0.95 - 7.65 0.63 1.72 27.83

Minimum 0.34 11.36 45.16 0.02 - - 0.37 - - 11.36

Maximum 6.7 46.42 70.25 16.90 16.90 - 20.79 12.98 26.97 46.42

Upper Carnallitite (22 holes for calculation)

Average 3.29 1.83 27.07 53.20 2.55 1.46 4.67 0.06 0.15 16.68

Minimum 0.20 - 11.06 1.74 - - 0.48 - - 4.72

Maximum 17.75 8.73 65.08 81.91 50.13 6.10 9.54 1.18 0.80 25.65

Lower Carnallitite (26 holes for calculation)

Average 6.32 0.09 20.26 30.83 2.82 37.93 1.81 - 0.92 8.84

Minimum 2.00 - 11.43 0.24 - 0.23 0.31 - - 0.06

Maximum 34.55 2.27 65.55 48.89 20.27 52.46 16.16 - 14.57 13.76

Kainitite Member (28 holes for calculation)

Average 6.80 0.07 32.75 1.11 61.16 3.54 0.73 0.43 0.33 19.77

Minimum 1.50 - 21.05 - 0.33 0.01 - - - 12.21

Maximum 9.45 0.48 94.90 5.13 78.33 14.20 7.07 1.84 8.05 23.89


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Figure 2.4 below shows the SandvikDE710 drilling rig used to produce the

aforementioned core samples. Furthermore, Figure 2.5 provides an example of a

core sample.

Figure 2.4 Exploration Drilling Rig


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Figure 2.5 Example of Core Sample

Preliminary Seismic Surveys

The Project has performed a preliminary seismic reflection survey (refer to Figure

2.6) to determine the seismic velocity depth structure of the deposit. The results

from this survey are used to migrate and calibrate the velocity data from the 2D

survey. The general understanding of the local geology will be the base for

designing a future 2D seismic survey. The main goals of the preliminary seismic

survey were to provide an image of the subsurface and establish the continuity of

the potash horizons as well as the overall structure of the deposit.

An example of the outcome of the preliminary vertical seismic profiling survey

interpretation is included in Figure 2.6.


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Figure 2.6 Example of the Interpretation of the a 2D Seismic Survey

Establishment of a Site Camp

During the exploration phase, a camp was established, which has grown from a

few persons to its present day capacity of approximately 200 people. This camp

provides shelter and services to the project personnel who participate in the Yara

Dallol Potash Project. The camp is equipped with a clinic and has a full-time

medic and nurse on site. The clinic also occasionally treats locals with medical

emergencies.

2.3.2 Definitive Feasibility Study

The exploration phase (as described in Section 2.3.1) is currently guiding the

Definitive Feasibility Study phase, and it is during this phase that the ESIA team

has worked closely with the engineering design team. This has allowed possible

Project processes, layouts and design alternatives to be investigated, and the

identification and assessment of impacts and establishment of suitable

mitigation/management measures that can be incorporated into the overall

Project design. These anticipated impacts and associated mitigation measures are

presented in the form of an ESIA Report (this report) and associated Management

Plans (refer to Part II).

It is expected that the Definitive Feasibility Study will be completed in January

2015. Yara will review the information in the study and decide whether or not to

pursue the project.


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2.3.3 Pilot Well Testing

A major part of the DFS was to establish the feasibility of solution mining this

deposit. Two pilot wells (PW-8 and PW-09) were established and operated for a

period of over 7 months. Each well has progressed well and the mining technique

has been confirmed as suitable with information received during this testing. The

wells are currently producing potash brines that are consistent with the estimates

obtained from dissolution tests of recovered core samples during the exploration

phase.

2.3.4 Bridge Engineering Phase

Bridge Engineering is required to investigate and identify project components on

the critical path that affect the overall timing of the project. Currently it is

assumed that bridge engineering will start in November 2014 and continue to

November of 2015.

2.3.5 Construction Phase

The construction phase cannot commence prior to the completion of the

Definitive Feasibility Study and the Bridge Engineering Phase as well as the

approval of the associated ESIA Study by the MoM and grant of Mining license

by The Ethiopian Ministry of Mines (MoM). On the assumption that the mine will

be established and that all relevant rights and permits will be obtained, it is

assumed that construction will commence in December 2015 for a duration of

approximately 24 months, ending in December 2017. The construction phase will

likely include the following initial construction activities:

Construction of Staff Living Quarters;

Location and start-up of the borrow pits.

Establishment of the rock crushing plant.

Construction of Access Roads (roads will be made of local material and will

be covered with an anti-dusting agent;

Construction of Evaporation Ponds;

Construction of Brine and Water Pipelines;

Construction of the mine processing facility (Process Plant), including office

and support facilities; and


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In addition to the above mentioned facilities, the proposed Project will have a set

aside area for tailings (Tailings Management Area – TMA) and basic

infrastructure within the Solution Mining Area.

The locality of this infrastructure with respect to the concession boundaries is

illustrated in Figure 2.7.

More detailed drawings illustrating the size and layout of the Evaporation Ponds,

TMA, Processing Plant, Staff Living Quarters and Solution Mining Area are

provided in Figure 2.8 to Figure 2.13. From a visual perspective, the maximum

heights of this infrastructure will be as follows:

TMA – 15m in year- 1 and 30m for the remaining years.

Evaporation Pond – 2m (the height of the perimeter berm).

Staff Living Quarters – average height of buildings will be 4m.

Solution Mining Area – a solution well has a maximum height between 1 and

2m and the blanket oil tank and oil separator will have a maximum height of

about 7.5m (refer to Figure 2.20 and Figure 2.21 on Page 2-38 and Page 2-39

respectively). It should be noted that mining will commence at the south west

corner of the North Musley concession.

Processing Plant – maximum height of about 30m and will include Project

support facilities such as electrical substation, emergency generators (4 X

2.5MW generators, with stack heights of approximately 10m), above ground

diesel storage tanks, temporary waste management areas, product

warehousing, workshop and vehicle repair area and administrative buildings

(refer to layout of the Processing Plant in Figure 2.13.

Section 2.3.6 of this Chapter describes in detail the processes associated with this

infrastructure and the mining and processing of potash bearing brine.

Public Access Restrictions

It must be noted that the Staff Living Quarters and Processing Plant will be

fenced and access will be restricted; however, road and pipeline corridors will not

be fenced and access will not be restricted.


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Figure 2.7 Proposed Yara Dallol Potash Project - Infrastructure Arrangement


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Figure 2.8 Evaporation Ponds within the Crescent Concession


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Figure 2.9 Tailings Management Area with the Crescent Concession


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Figure 2.10 Processing Plant and Staff Living Quarters within the Musley Concession


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Figure 2.11 Processing Plant and Staff Living Quarters within the Musley Concession


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Figure 2.12 Solution Mining Area within the North Musley Concession


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Figure 2.13 Processing Plant - Detailed Layout

Tank FarmSubstation and Emergency Generators

Processing PlantProduct Load Out

Admin-istrativeComplex

SOP Product Warehouse

Workshop & Vehicle Repair

Waste Management

Area

Fire Station

Water Collection

Basin


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2.3.6 Operational Phase

Once the construction phase of the proposed Project is complete, the

operational phase will commence. Early estimates indicate a potential life of

mine of approximately 20 years for the west half of the North Musley

concession.

Solution Mining

Mining Area

As is mentioned earlier in this Chapter, the ESIA will focus on three concession

areas. Based on data collected during the exploration phase, the resource

within these three concessions has been divided into the following three zones

(refer to Figure 2.14):

Zone 1 – located to the west of the fault zone where all four beds of

interest are not interrupted by the Bischofite interburden. This area has a

thinly bedded Sylvinite and Upper Carnallitite, with moderately thick

Lower Carnallitite and Kainitite beds. In this zone, the proposed cavern

height extends from the floor of the Kainitite bed to the roof of the

Sylvinite bed.

Zone 2 – consists of the Sylvinite and Upper Carnallitite beds situated

above the Bischofite on the east side of the fault zone where relatively

shallow deposit depths occur.

Zone 3 – consists of Kainitite, Lower and Upper Carnallitite and by the

Bischofite interburden interrupted on the east side of the fault zone where

relatively high depths of the deposit occur.

A generalised cross-section through the different mineralized beds is

illustrated in Figure 2.14.


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Figure 2.14 Cross Section Showing Typical Caverns in Zones 1, 2 and 3

Optimal Locations for Solution Mining

Factors determining the most optimal locations for solution mining include:

Depth of the resource zone and the ability to maintain necessary vertical

and lateral pressures.

Rock mechanics characteristics of the geologic units including density,

shear strength and creep strain rates.

Solubilities of particular evaporite minerals to determine brine

concentrations of particular mineralized units.

Geometry of the resource zone including thickness, sequence and

inclination (dip) of the mineralized zones

Taking these factors into account, Zone 1 in North Musley was chosen as the

location for initial mining (refer to Figure 2.12).

Zones 2 and 3 (Figure 2.14) were not considered at this time due to significant

challenges, including –

Area of excessive (greater than 15%) inclination, which results in

significant brine dilution;

Limited resource thickness (in the case of Zone 2); and

Depths and temperatures in the case of the Crescent concession.

Mining at Musley was not considered because of several issues, including:


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Uncertainty about the extent of the dissolution of the mineralized zone

associated with the former Parsons Mine;

The shallow depth of the mineralized zone (1); mineralization (2) and

uncertainty regarding the correct cut of depth for mining

The lack of success with several pilot caverns in 2011 and 2012; and

The unconsolidated nature of the overlying materials.

Mining Layout

The following layout was developed for the establishment of caverns located

in Zone 1 on the North Musley concession area.

Ultimately between 450 and 500 caverns are proposed in this mining area

(refer to Figure 2.12), each with a 35 to 45m radius, and a pillar width of 20 to

45 m (refer to Figure 2.15). Assuming an average mineralized thickness of

between 13 and 14m and recovery of 80% of the final brines, the average

cavern life in Zone 1 of North Musley is estimated at 1.5 to 2.0 years.

Between 35 and 45 caverns are estimated to be required to achieve an annual

production rate of 600 kilotonnes per year (ktpy) of sulfate of potash (SOP)

with the number of caverns that need to be replaced each year estimated at

between 22 and 28 (the life span of each cavern is estimated to be between 1.5

and 2.0 years). The mine life for mining in Zone 1 in the North Musley area at

this production rate was estimated to be approximately 21 years.

Figure 2.15 Cavern and Pillar Geometry for North Musley

(1) Please Note - because of the shallow depth the overburden is not consolidated and cannot support a cavern at a shallow

depth. The roof would collapse. (2) Please Note - because of the shallow depth the overburden is not consolidated and cannot support a cavern at a shallow

depth. The roof would collapse.


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The radius of the caverns (40m typical) was chosen as a trade-off between the

desirability of maximizing the volume produced per well and the need to

maintain rock mechanical stability. The 40m typical radius results in a cavern

footprint of about 5,000m2.

The caverns in North Musley Zone 1 will be between 80m and 270m below

ground surface and are to be accessed by a single well that will be used for

both water and oil blanket injection, and potash-bearing brine extraction. The

dual direction flow will be accomplished by means of an inner string inside

the casing. Potash-bearing brine will be pumped via a pipeline from the well

through to the evaporation ponds (refer to Figure 2.16).

Figure 2.16 Typical Well and associated Cavern

Oil (Diesel) Blanket

A low-density, immiscible blanket is used in solution mining to prevent

unwanted, upward dissolution of the cavern roof by the solvent, to prevent

leaching of salt from around the cemented casing of the well and to protect the

cemented casing from corrosion. The blanket material needs to be inert so that

it does not dissolve the salt rock and needs to be less dense than the solvent

liquid or the brine produced in the cavern. The blanket effectively floats at the

top of the cavern where it protects the roof from dissolution. The use of a

blanket material is intended to increase stability by controlling the height and

diameter of the cavern.

Almost all modern commercial solution mining operations use blanketing, as

well as other technologies such as sonar imaging, to control cavern shape and

optimise the rate and extent of salt dissolution.

Gaseous blankets (for example nitrogen and air) require high pressures (i.e. in

excess of 100 bar) when used in deeper solution mining operations, which can

become a health and safety concern. As such, liquid hydrocarbons (viz. diesel)

are preferred for all deep solution mining operations.


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Diesel has been chosen as the preferred blanket technology, due to its higher

viscosity, and greater resistance to migrating through microporous or

microfractured zones compared to compressed air.

At this stage it is anticipated that approximately 35 to 40m3 of diesel will be

required per mined cavern mined and that approximately 22 to 28 caverns

will be developed each year. Furthermore, the recovery rate of blanket oil

(diesel) is expected to be approximately between 50 and 75 percent.

Brine Extraction

Based on laboratory solubility testing, it is expected that brine composition in

the North Musley concession area will have a potassium chloride content of

between 35 and 105 grams per litre. To satisfy a 600ktpy SOP production rate

(based on an 85% plant recovery), a production brine flow rate of 800 to

900m3/h is required, with an injection of 850 to 950m3/h of solvent water.

Resource Recovery

The recoverable resource has been estimated based on the geologic model, the

cavern shapes and the density and thickness of potash bearing members and

is presented in Table 2.3.

Table 2.3 Summary of Minable Resource (Tonnes) for Zone 1 of the North Musley

Concession

Parameter Value

Number of caverns 450-550

Sylvinite (tons) 5,988,286

Upper Carnallitite (tons) 1,180,942

Bischofite (tons) 177,667

Lower Carnallitite (tons) 11,896,695

Kainitite (tons) 16,407,980

Total resource in 497 caverns (tons) 35,473,903

Post Solution Mining Process – Processing

Evaporation Ponds

From the wells, it is proposed to pump brine to a series of solar evaporation

ponds (these are illustrated in Figure 2.7 on Page 2-14 and Figure 2.8 on Page 2-

15) in which brine will be evaporated resulting in the crystallisation of

potassium-, magnesium- and sodium-bearing salts. These salts will then be

removed from the evaporation ponds and directed to the processing plant

(illustrated in Figure 2.7 [Page 2-14], Figure 2.11 [Page 2-18] and Figure 2.13

[Page 2-20]).

Process Plant

Figure 2.17 illustrates the process flow of intermediate potash product through

the processing plant.


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Figure 2.17 Process Flow of Potash Processing

Scrapers harvest crude potash from the evaporation ponds and this is

transported to the processing plant.

In the processing plant harvested salts will initially be crushed following

which crushed salts will enter the processing plant. The processing plant

converts the Potassium Bearing salts to K2SO4 (Potassium Sulphate). The

effluent from the dewatering process will be directed back to the evaporation

ponds, NaCl will be discarded to the Tailings Management Area. Excess

MgCl2 brine will be used to backfill the depleted caverns once they are

available. Until that time the excess brine will be discharged onto the salt

flats. The K2SO4 crystals produced are then further dewatered and dried

producing the SOP product. The dryer will be electric and not fuel powered.

The above mentioned process has been designed to produce approximately

600ktpa (79mtph) of SOP product. The processing plant is illustrated in Figure

2.13 on Page 2-20 and has been designed to produce both granular and

standard grade SOP with flexibility to fluctuate the quantity of each based on

market conditions.

Transfer Pumps

In order to transfer intermediate product and process water between

operating areas, the several pumps will be used. These pumps vary in size

from 500kW down to 15kW. The location of each pump was used in the Noise

Modelling.


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2.3.7 Process Utilities

Water Requirements

Solution Mining Requirements

Water for solution mining will be sourced from a series of water wells located

in the alluvial fans within the Project Area (refer to Figure 2.18). A

groundwater assessment project for the Dallol Area was undertaken by the

Ethiopian Water Works Design and Supervision Enterprise in December 2013.

The assessment concluded that Yara Dallol BV’s total water demand can be

drawn from these alluvial fans in a sustainable manner. An additional

hydrogeological study to verify this conclusion is currently being undertaken

and is expected to be finalized in December 2014. Interim results from this

study show that there is sufficient water in the area for all the proposed

potash Projects. It must be noted however that the allocation of this water

among the projects has not yet been determined.

Yara Dallol BV is proposing to use water that is available over 2 of the alluvial

fans in the Project Area. Figure 2.18 indicates this area in relationship to the

proposed Project.


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Figure 2.18 Potential Water Source for the Proposed Project


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The amount of water to be used annually is less than the estimated annual

recharge rate of the aquifers. This removal is therefore sustainable. The

volume of water extracted along with its temperature and its conductivity

from each well will be monitored on a continual basis for any changes. Since

the fans are located some distance from the production well fields, water will

be abstracted via dedicated pump stations and transported via pipeline to the

project site. Water from these alluvial fans will have the following

characteristics (refer to Table 2.4):

Table 2.4 Solution Mining Water Properties

Parameter Unit Data

Volume m3/h 850-950

Temperature °C 45

Total TDS ppm ≤32,000

Process Water Requirements

Process water used in the purification process will also be pumped from the

alluvial fans. Process water for the proposed Project has the following

characteristics (refer to Table 2.5):

Table 2.5 Process Water Properties

Parameter Unit Data

Volume m3/h 650

Temperature °C 45

Total TDS ppm ≤2,500

This water will also be used as firefighting water.

Potable Water

Potable water is to be used for drinking and sanitary needs. A potable water

system will be put in place that will meet regulatory requirements in terms of

quality. It is estimated that 20 to 30m3/h of potable water will be required

during the operational phase of the proposed Project.

Waste

Waste Water

Waste water produced from washing of equipment and regular maintenance

will be recycled in the operational process. Waste water shall not contain

foreign contaminants prohibited by environmental laws and regulation.

Sanitary waste water from toilets and urinals shall be collected in an

underground sewer system that will be constructed as part of the processing

plant’s sanitary facilities. A self-contained treatment system will be put in

place to treat sanitary water. As part of this treatment process, sludge will be


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removed every 8 to 12 months and disposed of by a licensed contractor.

Treated waste water will be re-used in the production process.

Solid Waste

The proposed Project will result in the following waste categories –

Reusable materials such as glass and plastic bottles, non-contaminated

containers, concrete blocks and wood;

Dry non-combustible waste such as glass, plastic, concrete and styrofoam;

Dry combustible waste such as cloth, wood trim, kitchen greases,

cardboard which cannot be shredded;

Metal;

Organic waste – compostable;

Shredded paper and cardboard;

Biomedical waste; and

Hazardous waste in designated containers; such as drums, bags and

pallets for containment of batteries, greases, oil filters, contaminated soils,

fluorescent tubes and ink cartridges.

These waste categories are elaborated on in Table 2.6.


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Table 2.6 Waste Types

Waste Type Generated/Location End Use

HAZARDOUS WASTE

Used greases Maintenance shop Incineration

Used batteries and power supplies Site wide Recycle or Dispose via Outside Contractor

Soiled pails and drums Process Plant Incineration

Soiled parts Process Plant Recycle or Dispose via Outside Contractor

Soiled rags Process Plant Incineration

Used absorbents Process Plant Incineration Oil filters Maintenance shop Incineration Used Oil Maintenance shop Recycle or Dispose via Outside Contractor

Ink cartridges Site wide Incineration

Laboratory Wastes Plant site Recycle or Dispose via Outside Contractor

Potable water sanitation Plant site Discharge to the Process

Fluorescents Site wide Recycle or Dispose via Outside Contractor

Hydrocarbon contaminated soils Site wide Incineration

Obsolete Electronics Site wide Recycle or Dispose via Outside Contractor

Sewage waste Site wide Sewage Treatment Plant

Medical wastes Clinic Incineration

SPECIAL WASTE

Used filters or bags from baghouses Process Plant Incineration

Radioactive Wastes (viz. from logging wells) Well Field Recycle or Dispose via Outside Contractor

RECYCLABLES WASTES

Scrap copper, brass, aluminium, precious metals Maintenance shop Recycle or Dispose via Outside Contractor

Scrap iron and steel including punctured and crushed spray cans Maintenance shop/Well field Recycle or Dispose via Outside Contractor

REUSABLE WASTES

Clean wood Process Plant N/A – will be reused

Clean drums, pails, boxes Site wide N/A – will be reused Wooden Pallets Process Plant N/A – will be reused Packaging Materials Process Plant N/A – will be reused Plastic and glass Bottles Site wide N/A – will be recycled Mechanical parts Maintenance shop N/A – will be reused Hardware (viz. old tools, fasteners, etc.) Maintenance shop N/A – will be reused Ducts Process Plant N/A – will be reused Building’s roof and side metal sheets Process Plant N/A – will be reused Paint Site wide N/A – will be reused

NON-HAZARDOUS WASTE


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Waste Type Generated/Location End Use

Cloth Site wide Incineration

Wood trim Site wide Incineration

Kitchen greases (from grease trap) Process Plant Incineration

Paper and cardboard Site wide Incineration

Concrete Site wide Landfill

Gypsum Site wide Landfill

Glass Site wide Landfill

Ashes Incinerator Landfill

Dried paint containers Maintenance shop Landfill

Plastics Site wide Incineration

Tires Maintenance shop Landfill/ Incineration

Fiberglass Maintenance shop Landfill/ Incineration

Kitchen waste Process Plant Compost

Sanitary sludge Wastewater treatment Compost

Shredded paper and cardboard Site wide Compost


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Waste management for the proposed Project will promote the 4R concept –

that is Reduce, Reuse, Recycle and Reclaim/Recover. Disposal will be the last

resort option. These concepts can be defined as:

Reduce – minimise the amount of waste produced by procuring bulk

goods rather than packaged goods and training workers to reduce waste

production.

Reuse – clean and maintain non-single use items for multiple uses when

and where possible.

Recycle – transform waste to be used as a primary matter in fabrication of

other good.

Reclaim/Recover – transform waste into a value added product (e.g.

composting).

Disposal – through incineration, onsite burial or offsite disposal by a

competent specialist contractor.

Waste management infrastructure proposed for the Project includes –

Waste Management Centre – the centre will receive all site waste, where it

will be sorted and managed as appropriate, either for its reuse, recycling

or disposal. All waste movements will be recorded in a register by the

Waste Management Centre attendant.

Incinerator - incineration will be achieved adjacent to the landfill. Wood,

shrub, cardboard that cannot be shredded, non-compostable kitchen

waste, biomedical waste and oily rags shall be burned at least once a week

when climatic conditions allow. No plastic, rubber or polymer will be

burned. Excessive wind is a no-go condition for incineration. The

incinerator shall be surrounded by a 15 meters building free area, which

will act as fire break. This operation shall be performed under close

surveillance to keep the fire under control at all times.

Composter - a Big Hannah Composter will be used for the management of

organic waste. Shredded paper and cardboard from offices will also be

sent to the composter. Excess organic waste which cannot be dealt with by

composting will be incinerated and ashes buried in the landfill.

Landfill – only non-hazardous waste will be sent for burial at the landfill.

The landfill will consist of a series of unlined cells which will be opened

and covered on a daily basis. A backhoe and bulldozer will be available

for the operation of the landfill.


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It must be noted that for during the construction phase of the proposed Project

all organic waste will also be composted in a similar fashion to that currently

used.

Plant By-product – NaCl and MgCl2

NaCl is a by-product of the evaporation ponds and the crystallisation process.

The estimated production flow rate of wet NaCl is approximately 133 tonnes

per hour (1.0 million tons per year). The intent is to store the NaCl in a Tailing

Management Area (TMA) (refer to the location and design of the TMA in

Figure 2.7 and Figure 2.9 on Page 2-14 and Page 2-16 respectively) of where

some natural dissolution will return it to the surface. NaCl by-product will be

transferred to the TMA by truck, where it will then be dumped and spread.

Dust emissions from the TMA are expected to be low and the tailings will

have 10% moisture content.

As there will be no spent mining caverns available for backfilling during the

first year of operations waste MgCl2 brine will be discharged to the salt flats or

used as a dust suppressant on unpaved road surfaces.

As solution-mining caverns become available to be backfilled, the MgCl2 brine

will be used for cavern backfilling firstly, with the excess to be used for dust

suppression and road maintenance.

Electricity

Electricity will be sourced from Ethiopian Electric Power (EEP) during the

operational phase of the proposed Project. EEP is planning on supplying a

230kV electrical line (1) to a common substation proposed in the greater Project

Area (refer to location in Figure 2.19). From this substation each of the mining

companies is responsible to source their own power, likely through a 132kV

line. The Yara Dallol BV line, from the EEP substation to the site, is

approximately 1.8km long. The average load of the facility is estimated to be

less than 32 MW (32,000kW – refer to Table 2.7). The timelines associated with

construction of the 230kV EEP owned electrical line have not been finalised;

however, it is estimated by EEP that funding for this line will be secured in

2014. Construction of the electrical line should take 2 to 3 years with a

completion date estimated between November 2016 and 2017.

(1) It must be noted that EEP is fully responsible for the design and construction of the Overhead Transmission Line


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Figure 2.19 Proposed Location of the Common EEP Substation and Proposed Routing of the Yara Dallol BV 132 kV Power Line from the EEP Substation to the Yara Project Area


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During the construction phase of the proposed Project (and through to

commencement of the operational phase), electrical requirements will be

sourced from diesel generators onsite. Electrical loading requirements from

commencement of the construction phase through to maximum loading

during operation are presented in Table 2.7.

Table 2.7 Electrical Power Requirements for during the Construction Phase and into the

Operational Phase

Date Load Area Load [kW]

Total Phase Load [kW]

Total Site Load [kW]

Mobilisation and Construction

Nov 2014 Bridge engineering & Construction

4,000

4,000 4,000

Cavern Development

July 2016 Brine/Well Field 500

Water Wells 500

Evaporation Pond 300

Tank Farm 700

Utilities 100

Miscellaneous 900

3,000 7,000

Commissioning of Operational Phase

September 2017

All Plant Equipment

25,000

25,000 32,000

Included in the Process Plant will be 4 X 2.5MW generators (stack height of

10m). These generators will supply the required electricity during the

construction phase. In the operation phase, the generators will be used for

emergency purposes only. The location of these is illustrated in Figure 2.13 on

Page 2-20.

Lighting

The Process Plant and Salt Screening Plant (situated at the evaporation ponds)

will be permanently lit (24/7) while the evaporation ponds specifically will

have vehicle lighting and minimum intersection lighting. The average height

of these light towers across the Project Site will be a maximum of 12m.

Diesel Fuel

Diesel fuel demands for the proposed Project are assumed to be

approximately 25m3/day for onsite activities and 30m3/day for product

transportation through to the Port of Tadjoura. Approximately 5 days of

storage will be kept on site.

Onsite diesel fuel will be used to fuel machinery, emergency power generation

as well as for vehicles. As is mentioned in Section 2.3.6 [Oil (Diesel) Blanket]

blanket oil (for use in solution wells) will consist of diesel. Diesel blanket

requirements for the proposed Project are presented in Table 2.8. Blanket oil


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will be stored in a 90 to 100m3 oil tank (refer to Figure 2.20) at the well field in

North Musley.

Upon completion of a well, blanket oil will be recovered (the recovery rate of

blanket oil [diesel] is expected to be approximately between 50 and 75 percent)

and directed to a series of oil / water separators (Figure 2.20 and Figure 2.21).

Recovered diesel will be reused as blanket oil.

The diesel will be delivered via tanker truck from a depot (refer to Figure 2.20

and Figure 2.21). Diesel requirements are expected to be approximately 50 to

60m3/day. The grade of diesel that will be delivered and used on site is the

same as throughout Ethiopia. Currently it contains 0.5% (5,000 parts per

million) sulphur.

Table 2.8 Blanket Oil Requirements for the Proposed Project

Item Value Units Notes

Solution Mining Blanket Oil Parameters

Oil Blanket Requirement for Operating Caverns ±1,320 m3/year

Blanket Oil Losses

Total Blanket Oil Make-Up for Mining ±150 m3/year

Oil Make-Up

Total Yearly Make-Up Blanket Oil Requirement ±250 m3/year

Oil Requirement

Total Blanket Oil in Circulation 1700 to

1900 m3

Requirement

+ Make-Up


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Figure 2.20 Blanket Oil Tank and Oil Separator at Well Fields in North Musley


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Figure 2.21 Isometric View of Blanket Oil Tank and Oil Separator at Well Fields in North Musley


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Compressed Air

The plant will require two compressed air systems; one for use in the

processing plant and one for instrumentation use.

2.4 MOBILE EQUIPMENT

The following is a proposed list of diesel mobile equipment will be required

for the life of the proposed Project (refer to Table 2.9):

Table 2.9 Diesel Mobile Equipment Requirements

VEHICLE DESCRIPTION

QTY PURPOSE

Front-end Loader 3 TMA Maintenance (1), Solution Mining Well Field Expansion (1)Port

Bulldozer 2 Wellpad and Road Maintenance and Solution Mining Well Field Expansion (1), TMA Maintenance (1)

Excavator 2 Wellpad and Road Maintenance, Solution Mining Well Field Expansion, TMA Maintenance and Berm Canal Maintenance (1)

Harvesting Scraper 10 Pond Harvesting (10)

Graders 5 Pond Windrows (4), Wellpad and Road Maintenance and Solution Mining Well Field Expansion (1)

Oil Tanker Truck 3 General Distribution of Diesel Fuel around Site (2), Diesel Blanket Oil Distribution and Recovery (2)

Drill Rig 2 Drilling and Casing of Production Wells (2)

Workover Rig 1 Workover of Production Wells (1)

Backhoe 1 Drilling Support Vehicle (1) Road Maintenance and Solution Mining Well Field Expansion

Logging Unit 1 For Core Logging during Drilling

Low-bed Truck 1 Heavy Mobile Equipment Transport

Heavy Duty Flat Bed, c/w cab

1 Construction Equipment Transport (1)

Hydraulic Telescopic Mobile Crane

1 Drilling Support vehicle (1), Wellhead Skid Installation & Plant Maintenance (1)

Bobcat 2 Drilling Support Vehicle (1) Wellpad and Road Construction (1) Ponds Management and Crushing area (1)

Water Tanker Truck General Distribution of Water around Site , Drilling Support Vehicle

Brine Tanker Truck 1 MgCl2 Road Anti-dusting Treatment

Dump Truck 10 Tailings Trucking to TMA

Product Transport Trucks 96 Transport Product to Port of Tadjoura

200 kW Portable Genset 1 General Purpose around Site

Medium Duty Flat-bed Truck c/w Lifting Arm

2 Drill Pipe and Casing Transport, Wellfield Pipe Transport and Pipeline Repair

Fire Truck (fully equipped)

1 Firefighting

Ambulance (fully equipped)

1 Medical Services and Transport

Welding Trailer 1 Trailer-mounted Welding Machine

Mobile Workshop 1 General Purpose around Site

Scissor Lift 1 Outdoor diesel powered

5-Seat SUV 11 Personnel Transport around Site

5-seat flat bed utility vehicle

6 4 x 4

Portable Light Towers, Diesel-Powered

3 Night Lighting

Vacuum Truck 10 Sanitary waste management


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VEHICLE DESCRIPTION

QTY PURPOSE

Electrical Utility Truck (Boom Truck)

1 Power Line and Substation Repairs

Bus 5 Transport of Personnel to Site

2.5 EMPLOYMENT

The project has been providing employment since 2010 (as part of the

exploration phase) and has built a positive relationship between staff and the

local inhabitants. The number of local inhabitants employed has increased

since 2010. Should the proposed Project go ahead into the construction and

operational phases, skilled construction workers, general helpers,

management, drillers, labour etc. will all be required. It is expected that the

proposed Project will employ approximately 1,000 and 800 persons during the

construction and operational phases respectively.

Table 2.10 Staff Estimate for the Operational Phase of the Proposed Project

Skill Set Estimated # of Positions

Yara Dallol Site including Camp

Senior Management 18

Degreed Employees 42

Tradesmen 133

Skilled Labor 242

Unskilled/Helpers 46

Product Truck Drivers 52

Serdo Site

Senior Management 1

Degreed Employees 1

Tradesmen 0

Skilled Labor 11

Unskilled/Helpers 3


Tadjoura Port and Camp

Senior Management 2

Degreed Employees 0

Tradesmen 0

Skilled Labor 8

Unskilled/Helpers 18


Please Note – office administrative employment opportunities will also be available in Addis

and/or Mekele.

2.6 WORKING HOURS

Production of Potash is planned at rates of 600ktpa per year operating 24

hours per day 316 days per year. Solution mining will run continuously 24

hours a day, 7 days per week and 365 days per year.

Construction is proposed to be undertaken on a 24 hour basis, 7 days per

week over a period of 24 months. It should be noted that the staff estimates


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provided in Section 2.5 assume an 8 hour working day or a 48 hour working

week.

2.7 ANCILLARY INFRASTRUCTURE

2.7.1 Transport Route

Yara Dallol BV has identified two road connections from the Yara Dallol

Potash Project Area through to Djibouti. These are discussed below

Preferred Long-term Road connection for use during the Operational Phase

Refer to Route illustrated in Figure 2.22.

It is currently proposed that the preferred long-term road connection will be

used during the operational phase of the proposed Project to transport potash

product (Sulphate of Potash) from the proposed Processing Plant at the Yara

Dallol Potash Project Site through to the Port of Tadjoura, Djibouti for export.

This long-term road has a weight limitation of approximately 60 metric tonnes

Gross Combined Vehicle Weight. The truck cabs and trailers that are

currently being evaluated are approximately 20MT, leaving a payload of SOP

of approximately 40MT.

The preferred long-term road connection runs south from the Yara Dallol

Potash Project Area down the Danakil Basin (the ‘lowland route’) and

intersects the existing road about 20km north of Afdera to Serdo, through to

the proposed new border crossing at Balho and down through to the Port of

Tadjoura.

The proposed route associated with this road connection will traverse due

south along an existing paved road through to the Hamad Ela Village. From

Hamad Ela the route continues south through the Danakil Basin to the town of

Afdera. This section of the route will be upgraded to a heavy duty asphalt

road by the Ethiopian Roads Authority who has already commenced

engineering studies.

The route will then join the Afdera to Serdo road which has a length of 183km

and is currently in excellent condition following the laying of a new asphalt

surface in 2009, although traffic levels have been low. The route will then

follow the Ethiopian National Highway 2 (N2) for 130km through to the

proposed Balho border crossing between Ethiopia and Djibouti.

Approximately 80km of the road between Dichito and Balho (on the Ethiopian

PLEASE NOTE –

The ancillary infrastructure mentioned in this Section does not form part of the scope of the

ESIA, as much of this infrastructure is either existing or is being upgraded/ constructed

independently by the Ethiopian and Djibouti governments. This Section does however provide a

brief summary of what ancillary infrastructure is proposed.


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side) remains in poor condition or unfinished and will be completed once the

road from the Port of Tadjoura and the proposed Balho border crossing point

has been constructed.

From Balho, the route winds down to the Port of Tadjoura via a high capacity

asphalt road that is currently being built, passing through the towns of Dorra

and Randa. The total length of the road is approximately 110km. The road is

still under construction and is expected to be complete by December 2015.

Short-term Road Connection for use during the Construction Phase

Yara Dallol BV is proposing to use a short term highland road connection

during the construction phase of the proposed Project and during the time

that the road through the Danakil Basin between Hamad Ela and Afdera is

been built. It is anticipated that this road connection will be used during the

construction phase of the proposed Project to transport construction

materials/machinery to the Project Area from the Port of Djibouti.

This short-term road connection follows the same route as the long-term road

connection; however, at Hamad Ela Village the route runs due west (the

‘highlands route’) through to the town of Berahale. From Berahale the route

runs south west into the highlands and follows an existing road to the town of

Shirket. From Shirket the route decreases in altitude due east and intersects

the existing road in just north of Afdera. From here the road continues south

to Serdo, through to the proposed new border crossing at Galafi and down

through to the Port of Djibouti.

From Afdera the route connects to the existing Afdera to Serdo road,

following which the same routing as the long-term option is followed through

to the Port of Tadjoura, Djibouti.

PLEASE NOTE –

In order to understand any key social and environmental sensitivities and key risks to the

proposed Project, associated with the use of this ancillary infrastructure, Yara Dallol BV

appointed ERM to undertake an additional Socio-environmental Screening Study (SESS); the

objective of this SESS is was to investigate the potential social and environmental sensitivities of

the proposed road connection for both the short term import of construction

material/machinery and the long term transportation of potash product to the Port of Tadjoura.

By integrating social and environmental considerations as early as possible into the logistics

planning process, it is intended that the risk of any potential negative environmental and social

impacts and risks to the proposed Project may be avoided or reduced.

As part of this SESS the following aspects were investigated:

Biodiversity;

Social (including Health and Safety); and

Cultural and Heritage

It must be reiterated that the proposed road connection and associated Socio-environmental

Screening Study do not form part of the scope of the ESIA


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Figure 2.22 Proposed Long-Term Lowland Road Connection for the Export of Potash Product through the Port of Tadjoura, Djibouti


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Logistics

Based on the permissible axle load of 10 tonnes per axle and additional

Ethiopian regulations covering bridge weight limits, the proposed Yara Dallol

Potash Project will use a heavy duty truck similar to the IVECO shown in

Figure 2.23). It will be possible to transport approximately 40 tonnes of potash

per truck, as each truck will have a total of 6 axles and will thus have an axle

loading of 10 tonnes at the rear of the truck and 8 tonnes in the front. The

gross combined weight of truck and trailer (loaded) is assumed at 60 tonnes.

Each truck will have one covered silo trailer similar to the one shown Figure

2.23.

Figure 2.23 Truck (Iveco Tracker AT 720t44 TH) and Silo Trailer Proposed for the Project

It assumed that there will be approximately 110 trucks movements per day

(this includes 48X product loaded trucks travelling from the Yara Dallol

Potash Project Site and the Port of Tadjoura and 48X empty trucks travelling

from the Port of Tadjoura through to the Yara Dallol Potash Project Site and 14

other deliveries to site). This truck number estimation is based on the

assumption that the average speed of each truck will be 60km/h, with a

maximum speed not exceeding 80km/h. The turnaround time for each truck is

estimated to be approximately 16 hours (which includes 2 hours for wasted

time (1)).

(1).e. stopping time for drivers to have meals, rest, loading and unloading time, border crossing time etc.


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During the trip the drivers will need to be switched out. For this purpose it is

proposed to have a private truck stop located near Serdo. This facility will

contain the following infrastructure:

Washrooms;

Lounge/waiting room;

Parking area for 100 trucks divided into full and empty. At least two

separate secure entrances should be provided to not mix traffic;

Parking area for support/operations staff and transfer busses;

Office space for logistics control/reporting;

Security post;

Mechanic office; and

Small truck parts depot for common items (wiper blades, window

washing fluid, tires, etc.).

It is proposed that the drivers will live in Semera, the capital of the Afar

region. With this arrangement the drivers would be able to spend every other

day with their families.

Once the trucks arrive in Tadjoura and dump their loads they will proceed to

an offsite Yara Camp. This camp is sized to hold the 48 trucks and 52 drivers

as well as having the following infrastructure:

Camp for minimum of 52 drivers;

Lounges or common areas for entertainment (pool tables, games, TVs,

etc.);

Parking area for 50 trucks (empty);

Parking area for support/operations staff delivers (food, drinks, etc.);

Office space for logistics control/reporting;

Security post;

Tow Truck and mechanic (Djibouti side breakdowns);

Small truck parts depot for common items (wiper blades, window

washing fluid, tires, etc.); and

Medical facility.

2.7.2 Electrical Overhead Transmission Lines (OHTL)

As is mentioned in Section 2.3.7, the EEP is planning to bringing in a 230kV

OHTL from the main Mekele substation to a proposed Dallol electrical

substation in the greater Project Area (refer to location of this substation in

Figure 2.19 on Page 2-35). The design of this line has been completed by EEP.

2.7.3 Post Transport Product Processing

The SOP final granulated product from the site will require screening to

ensure that it meets product specifications prior to loading onto a ship. This


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screening will produce a small amount of off spec material that will be

recycled into the standard product storage facility and will be used again.

2.7.4 Port Infrastructure

The Port Authority of Djibouti is currently developing the Greenfield

Tadjoura port largely for Ethiopian exports as well as for some imports. Area

is available at this port for bulk products, such as Potash. As such, it is

proposed to transport SOP product from site through to Tadjoura Port in

Djibouti for export. This port is currently under construction and will be

completed by September 2016 before the proposed Yara Dallol potash Project

commences with mining operations.

Facilities at the port will include –

Two large storage domes with a capacity of 45k tonnes each;

A truck unloading facility;

Equipment for loading SOP product onto a common conveyor; and

Support areas including offices, control room, washrooms, QC lab,

maintenance, utilities, etc.

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