Mining Concessions Heve Been Renewed for 99 Years Whereas the Right to Operate the Railway Was Not Renewed
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Report No. 482-TUN TOE RETURCEDro 6EPORTp yDSK FILECOPr Appraisalof RIE O EotSDS GafsaPhosphate Project RETURN T Public Disclosure Authorized Tunisia REPORTS DESK (In Two Volumes) IN VolumeII: Annexes WITH July12,1974 ONE WEEK Industrial ProjectsDepartment NotU for PublicUse Public Disclosure Authorized Public Disclosure Authorized Documentof InternationalBank for Reconstructionand Development InternationalDevelopment Association Public Disclosure Authorized This teport was preparedfor official use only by the 8ank Group. it may not be publishd. quoted or cited without BankGroup authOrization.The Bank Groupdors not accept re5pon- sibi)tsykcr the accuracyor complerenessof the report. TUNISIA APPRAISAL OF GAFSAPHOSPIATE PROJECT VOLUMETT CURRCY EQUIVAlENTS WEIGHTS ANDMEASURES Except where otherwise indicated, Al units are metric all figures are quoted in U.S. Dollars (US$) and for Runisian 1 Metric Ton = 1,000 Kilograms (kg) Dinars (DT) 1 Metric Ton = 2,205 Pounds 1 Kilometer (km) = 0. 62 If les September 1973 - February 19714 1 Meter = 39.3 Inches 1 Dinar = 2.27 US Dollars 1 US Dollar = 0.44 Dinar ABBREVIAIIONS AND ACRONYMS BPL Bone phosphate of lime. It is the equivalent of Tricalcium Phosphate content in rock phosphate or o.46 units of P2 05. BTS Tonnes Brutes Tri6es Seches - gross sorted dry tons CERPHOS Centre d'Etudes et de Recherches des Phosphates Mineraux - Paris. CIPHOS Compagnie Nouvelle des Phosphates du Djebel N'DiUa GAFSA Compagnie des Phosphates et du Cheuin de Fer de Gafsa ICM Industries Chiiiques Mahgrebines NPK NPK Tunisian Fertilizer Company SIAFE Soci6tg Industrielle d'Acide Phosphorique et d'Engrais SNCFT Sooi6t6 Nationale des Chemins de Fer Tunisiens SOFREMINES So¢i6t6 Francaise d'Etudes Minieres - Paris SOGREAH Soci6t6 Grenobloise d'Etudes Hydrauliques STEC Socidtg Tunisienne d'Engrais Chimiques STEG Socidt6 Tunisienne del Electricit6 et du Gaz STEPHOS Soci6t6 Tunisienne d'Exploitation Phosphatiare STIPCE Soci6t6 Tunisienne Indcstrielle de Produits Chiniques et d'Engrais FISCAL !EAR OF GAFSA COMPANY January 1 - December 31 Industrial Projects Department July 12, 1974 TUNISIA APPRAISAL OF THE GAFSAPHOSPRAIE PROJECT Table of Contents Volume II ANNEXES 1. Glossary of Technical Terms 2-1 The GAFSACompany - History 2-2 - Organization and Management 2-3 - Geology and Ore Reserves 2-4 - Mines 2-5 - Plants 2-6 - Infrastructure 2-7 - Manpower 2-8 - Historical Income Statements 2-9 - Historical Balance Sheets 3-1 The Market 3-2 The Tunisian Fhosphate Industry 4-1 Sehib Project - Technical Description 4-2 - Organization and Management 4-3 - Implementation Schedule 5-1 Sehib Project - Capital Cost Estimates 5_2 - Working Capital Requirement 5-3 - Equipment and Services to be Financed by the Bank 5_4 - Disbursement Schedule 6-1 Sehib Project - Assumptions for Financial Projections 6-2 - Operating Cost Projections 6-3 - Projected Income Statements 6-4 - Projected Source and Application of Funds 6_5 - Financial Rate of Return and Sensitivity Tests 6-6 - Break-even Point Analysis 7-1 Modernization Program - Technical Description 7-2 - Management and Implementation 7-3 - Capital Cost Estimates 7-4 - Production and Operating Cost Projections 8-1 The GAFSA Company - Projected Income Statements 8-2 - Projected Source and Application of Funds 8-3 - Projected Balance Sheets 9-1 Economic Rate of Return Calculations and Sensitivity Tests 9-2 Foreign Exchange Effects ANNEX 1 TUNISIA- GAPSA PIIOSPHIATEPROJECT GLOSSARY OF TECHNICAL TERMS TSED IN THE TEXT Apatite - The major nlhosDhorusminerals of most phosphate rock including Tunisian rock are in the aoatite group and can be representedby the formula Ca5 (P0 4 ) 3 (F Cl OH). The (F Cl OH) radical mav be all fluorine. chlorine, or hvdroxyl ion or any combinationthereof. The (P04) radical can be partlv replaced by small quantities of V04, AsO4, Sif4 and C03. Also small ouantities of calcium can be replaced bv many elements, such as magnesium, manganese.,strontium, lead, sodium, uranium, cerium, and vttrium. Air Classification - Classificationis the process of separatingparticles of various sizes,densitiesand shanes. This can be done by screening or by gravity methods. Gravity methods use the concept of different settling rates of particles of different size, shape and density in a fluid media (water, air or slurry) to segregate them. With the air classificationof phosphate rock the particles gravitate against a rising current of air, the flow rate of which is so adjusted that the desired heavv or coarse particles fall to a botton discharge,while the lighter ones are upswept at a higher speed than is compensatedby their falling rate and overflow. Beneficiating - The dressing or processing of ores for the Purpose of (1) regulating the size of the desired product: (2) removing unwanted constituents:and (3) impro- ving the quality, puritv of assav grade of the desired product. The seDarationand accumulation of economic minerals from waste material. Benefi- ciation of phosphate rock can be done by washing, air classificationr,calcination, flotation, or electrostatic separation. BPL - Bone nhosphate of lime. Th{s is the enuivalent of the tri calcium DhosDhate content (Ca3(PO4)2) in the rock nhosphate. One BPL unit is equivalent to 0.458 units of phosphorus pentoxide (P20 ), and one P905 unit is ecuivalent to 0.436 units of phosphorus (P). Alternatively1 unit of P is equivalent to 2.2912 units of P205 and 5.007 13PLunits. BPL is the terminologymost used when referring to the qualitv of rock phosphate-but P105 is most often referred to when discussing the phosphate content of fertilizersand acid. ANNEX 1 Page 2 BTS - Bruttes Triees Seches - gross sorted drv tons. This is the unit used to refer to run of mine ore after sorting out waste by coarse screening and/or hand sorting. It is a calculatedfigure based upon the weight of the wet run of mine ore adjusted for an assumed moisture content of 12%. Calcination - Heating ores, concentrates,precipitates, or residues to decomposecarbonates, hydrates, or other compounds. When carbonatesare heated sufficientlythey decom- pose, evolving C02 and leave behind the corresponding oxides. The temperatureof dissociationdepends upon the carbonate. Calcining of nhosphate rock results in dissociationof the mineral aDatite, with the CO2 being dissociatedfrom the carbonatewhich is combined to the calcium. In addition, the organic material contained in the Dhosphate rock is burned off. Epure - This is ground nhosphate rock ungraded bv the addi- tion of phosphoric acid. GAFSA produced a 71-72 BPI,Epure bv adding phosphoric acid to their low grade 60-65% BPL rock. Filterabilitv - In the context used in the report, this refers to the ease and speed with which the phosphate rock can after digestionwith acid be filtered in a Phosphoric acid plant. Because of the high organic content the GAFSA rock has a slow filtrationrate which restricts acid nroductionor requires that a larger filter area be installed. Flocculation - The gathering of suspended particles into aggrega- tions. The addition of a flocculantgreatly improves that rate of filtration (i.e., filterability) of the GAFSA phosphate. Gypsum - A natural hydrated calcium sulDhate CaSO42H20. This is produced from the anatite mineral contained in the phosphaterock during the digestion phase of phosohoricacid production,and seDarated from the solution during filtration. ANNEX1 Page 3 Hyperphosphate - Phosnhate rock ground to less than 150 micron and sold for direct applicationas a fertilizer. MAP - Monoammonium phosphate - a nitrogen phosphate fertilizer made from ammonia and pure phosphoric acid with a formula of NH4H2PO4, and an analysis of 12% N, 61% P. DAP or Diammonium phosphate has an analysis of 21% N, 53% P. Oolite - A sDherical to ellipsodialbody, 0.25 to 2 milli- meters in diameter. In the Tunisian phosphate rock this is made up of apatite with a small amount of included organic material. Superphosphate - Anv of various commercialphosphate fertilizers obtained as white to gray granules or powders by acidulating grotnd insoluable phosphate rock; as (SSP) (1) Simple sunerphosphate - a product made by acidulating with sulfuric acid, consisting essen- tially of soluable primary calcium phosphate, calcium sulphate, and small quantities of secondary calcium phosphate and containing usually about 20% of avail- (TSP) able phosphoric acid, (2) Triple supernhosphate - a product made bv the addition of phosphoric acid, to phosphate rock, consisting essentiallyof primary calcium Phosphate and containing usually 40 to 50% of available nhosnhoric acid. Tailing - The part of any ore separatedby processing and treated as inferior in quality or value; the ganque, sand, ,ravel,slimes, and other refuse material resulting from the w7ashing,beneficiation or treat- ment of ground ore. Those portions of treated ore regarded too noor to he treated further. R3ashing - In phosDhate technology this means removing slimes from the relativelv coarse ore by washing, tumbling, scrubbing. Prior to washing in a nhosphate washing plant, the very coarse ore is separatedbv screening, hence, the final Droduct after washing is the middling. Industrial Projects Department April 1974 ANNEX2-1 TUNISIA: GAFSAPHOSPHATE PROJECT HISTORY OF THE CAPSA COMPANY 1. Phosphate reserveswere discoveredin 1886 near Metlaoui by the geologistPhilippe Thomas. In 1896, the authoritiesgranted a concession for 60 years (a) to exploit the phosphate reserves in the south of Tunisia located between the oasis of Gafsa and the border of Algeria, and (b) to build a