Western Potash (TSX.V: WPX, FSE: AHE) reported an initial NI 43-101 compliant mineral resource estimate for its Milestone property of 32 million tonnes of indicated potash resource (contained KCl) plus 230 million tonnes of inferred potash resource. The 500 square kilometre Milestone property is located 30 kilometres south-east of Regina, and southeast of Mosaic's Belle Plaine Mine, one of the largest producing potash solution mines in the world.
"Our board is extremely satisfied with the initial results of the resource calculation, considering that it only reflects the first 4 wells drilled at Milestone,” Western Potash’s President, Patricio Varas stated, “We anticipate that the resource in the indicated and measured categories will be enhanced by the additional 5 wells that have now been completed. This resource calculation is only the beginning…the Company will now fundamentally change from a pure exploration company to one that is poised to begin the development of Saskatchewan's newest green-field discovered Potash mineral resource in decades."
The 43-101 report, completed by Agapito Associates, recommended a two phased development program, including 5 additional wells, and additional 2D and 3D seismic surveys. As Varas pointed out in his statement, Western Potash has already completed 5 additional wells in anticipation of this requirement, and had already completed an additional 179 line kilometres of 2D seismic. The combination of seismic and the five completed wells will allow for an upgrade of the current inferred resource into the indicated and measured categories.
“The Company is also pleased to announce that it has initiated its 3D seismic survey on the property, following the granting of all required permits, approvals and permissions. It is expected that this survey will be completed in the current quarter.”
Following the completion of the current phase of exploration, Western Potash intends to move forward with a preliminary economic assessment of the project. “The preliminary economic assessment will aim to conceptualize the viability of a potash mining operation on the Milestone property. The assessment will place particular focus on quantifying the expected beneficial effects that the higher Potash formation temperatures measured at Milestone may have on reducing the energy requirements of a Potash operation, so as to estimate potential operating cost savings.”
Shares in Western Potash rose 8% on the positive news.