Western potash Corp announces a private placement

24th Dec 2008, 12:00 am And who says financing junior exploration companies difficult? During a commodity cycle downturn, only companies with good assets backed by a credible management team will be able to survive. Such companies also continue to receive the financial backing of investors. It should therefore be hardly surprising that Canadian Venture and Frankfurt listed Western Potash Corp. (TSX.V: WPX, FSE: AHE) managed to complete a private placement even in this down market.

The private placement entails up to 8,514,850 flow-through shares (the “Shares”), subject to the approval of the TSX Venture Exchange. The Shares will be issued at a price of $0.33 per share. The proceeds from this private placement will be used for further drilling and exploration of the Company’s Manitoba and Saskatchewan properties.

It is also worthwhile highlighting that WPX already has over C$35 million in its treasury. Additional funds clearly indicate the company’s expansion plans which include potential acquisitions. Exploration and development efforts are currently underway at its existing permits and WPX recently mobilized a drill rig supplied by Ensign Drilling Partnership to the Company's Russell-Miniota Exploration Permits in Manitoba.

The private placement comes on the heels of recent results from its sixth and seventh potash exploration wells drilled in the “Miniota area”, in south-western Manitoba, as part of the expanded Phase I drill programme. Permits cover over 1,000 square kilometers and are adjacent to BHP Billiton’s Potash Lease and Agrium’s Exploration Permits along the Manitoba border. All drill intercepts can be considered the true thickness of the mineralization, as the salt beds are flat lying and the holes were drilled vertically.

Both wells intersected the Esterhazy member, the potash formation being exploited at the Rocanville mine located 30km to the north-east.  These wells targeted potash sequences identified from the Company’s 2008 2D seismic program completed in August, as well as, from extensive historical data acquired by the company in anticipation of the granting of the permit. The best interval reported was from well Russell-Miniota-007, where potash was intersected from 975.2m to 976.4m (1.2m) returning 32.0 wt% K2O.  

These results represent some of the best grade intersections obtained by the Company from the property to date, and compare favorably with historic drilling in the area, which intersected potash mineralized zones with grades up to 19.4% K2O over 2.94m.  Results are indeed encouraging as the geological setting and mineralization are consistent with characteristics of other potash deposits in Saskatchewan and Manitoba. The company is further encouraged as the distance between these holes of 7.5 Km in conjunction with the interpreted seismic data indicate the potential presence of a sizable potash resource.

The company is continuing with its Phase I drill programme within the southern portion of QP-168, and the recently acquired QP-172 potash permits, having recently completed its eighth well and currently moving the drill to the ninth location, testing the western extents of the property. Results from these wells will be reported as they are received.

About Western Potash
Western Potash Corp. is a mineral exploration company engaged in the evaluation, exploration and development of potash mineral properties in Western Canada.  The Company intends to define and develop a world-class potash deposit in an ecologically sustainable, economically efficient and socially responsible manner.