Blackham Resources Ltd (ASX:BLK) and Salt Lake Potash Ltd (ASX:SO4) have executed a binding split commodity agreement for the development of a sulphate of potash (SOP) operation based at Lake Way near Wiluna in Western Australia.
Under the agreement, Salt Lake Potash will acquire Blackham’s brine rights and Blackham will acquire gold rights to Salt Lake Potash’s Lake Way holdings, with each company retaining a royalty on their respective holdings.
Lake Way tenements
Salt Lake Potash will sole fund the evaluation and development of any SOP operation at Lake Way.
The scoping study on the development of an SOP plant at Lake Way was completed by Salt Lake Potash in 2018 and it commenced building evaporation ponds on Blackham’s Lake Way mining leases last quarter.
Salt Lake Potash plans to commence the dewatering of Blackham’s Williamson Pit this quarter in advance of Blackham’s scheduled commencement of mining at the Williamson Pit in the September quarter.
The initial evaporation ponds will have the capacity to hold the measured resource of 1.2 gigalitres of Williamson Pit brines at an average grade SOP grade of 25 kg/m3, which contains an equivalent of 32,000 tonnes premium SOP.
Salt Lake Potash’s development of the SOP project at Lake Way will have significant benefits to Blackham including:
• Salt Lake Potash will pay for all costs of dewatering the Williamson Pit;
• Sharing of overheads and infrastructure costs between the SOP Plant and Blackham’s Wiluna Gold Mine, including a reduction in tenement holding costs for Blackham;
• Access to about 290 square kilometres of tenements prospective for gold to the south of the Wiluna Mine Sequence; and
• Blackham receives a 4% royalty on all SOP production from its tenure.