PUERTO DE SANTA MARIA, Spain () -- With the curtailment of its marine diamond mining joint venture with Diamond Fields International offshore Namibia, Bonaparte Diamond Mines [ASX:BON] is shifting its resources to developing prospective marine phosphate deposits in the area.
Rapidly rising food prices and supply shocks have triggered riots in a growing number of nations, which in turn has led to rising demand for fertiliser and the phosphate mineral feedstock that is used to produce it.
Bonaparte is now extending marine exploration, mining skills and resources to exploit marine phosphate deposits on Namibia's coastal shelf off the port of Walvis Bay.
"Planning is at an advanced stage for systematic sampling of phosphatic seabed sediments in the 1,000 square kilometres Meob Project area (EPL 3323) for commencement mid 2008," management reported in a May 26 Australian Stock Exchange release.
A scoping study is expected by the end of 2008.
Promising Prospects for Phosphates
Sharp increases in fuel and other supply costs have prompted Bonaparte and Diamond Fields International to curtail their marine diamond mining operations despite record sale prices and recent vessel operating improvements achieved by the marine team, according to management.
Remaining resources in the joint operations area will be available for future mining should the economics warrant.
Trends in the market for phosphate used in fertiliser production are more promising, however. Originally discovered and delineated in the 1970s, but undeveloped, Bonaparte is planning to produce 40-50 million tonnes of unconsolidated phosphate sediment with a grade of 10%-15% P2O5 with the potential for onshore beneficiation to yield 3 million tonnes of commercial, 35% grade P2O5 per year.
"We are in a strong position to develop a very significant marine phosphate resource from which we establish a position as a global player in the world phosphate market. The Namibian licence areas are well situated for access to existing port facilities at Walvis Bay and thereby for prime access to fertiliser markets along the Atlantic seaboard, particularly in Brazil as well as in Africa," managing director Michael Woodborne stated in the release.
Phosphates and Fertiliser
Essential for photosynthesis in plants and for other living organisms to manufacture parts such as bones and teeth, phosphorous is one of the three principal components - along with nitrogen and potassium - required in the production of fertilisers, according to background information in a May 28 Bonaparte filing with the ASX.
Guano deposits and rock phosphate originally formed in marine environments are the two main sources of phosphorous used in fertiliser production. Besides the marine deposits Bonaparte is working to develop, Ma'aden, Saudi Arabia's national mining company, is investing some $3.4 billion to fully develop what it expects to be the world's largest source of diammonium phosphate, the Al Jalamid phosphate deposit at Ras az Zawr in its Eastern province, .
"Rock phosphate prices have increased from $50/tonne FOB (free on board) in early 2007 to $350-$400/tonne FOB in early 2008 (UBS Investment Research, April 2008)," Bonaparte management noted. "Exports of phosphate fertiliser products from China, which currently account for more than 20% of global granular fertiliser, are expected to cease. Eighty percent of global rock phosphate supply comes from five producers, resulting in a highly restricted supply of raw materials."
Namibian Marine Deposits
The marine phosphate deposit Bonaparte is working occurs as nodules of fine-grain sized sand particles at depths ranging between 150-300 metres seawater.
Bonaparte's initial exploration target
