Basin analysis and investigation of rates of precipitation in the catchment areas of the Ethiopian Highlands west of the project area allows for estimation of the annual recharge rate in the Dallol region and more specifically in the alluvial fans located on the Allana license area. In addition, by monitoring water levels in observation wells, as initiated in March, 2012, the recharge rate can be estimated. This work is ongoing, however, Fugro has calculated, based on a conceptual geohydraulic model, a recharge rate of between 35.7 million cubic metres and 55.2 million cubic metres of water annually for the combined Allana license areas.

Farhad Abasov, President and CEO, commented: "Allana is extremely pleased that the hydrogeological studies in the alluvial fan area have outlined a significant water reservoir and significant yearly recharge. With annual consumption estimated at 16 million cubic metres of water per year for a 1 million tonnes per year MOP operation, the recharge rate alone is adequate to expand future production to 2-3 million tonnes per year of MOP. Delineation of these water resources marks an important milestone for Allana's potash project and has further de-risked the project as sufficient water has now been identified for operations.