THE CANADIAN PRESS
VANCOUVER - Potash One Inc. is making plans to develop a new potash project near Belle Plaine for an estimated US$1.9 billion.
The mine would be adjacent to the largest potash solution mine in the world at Belle Plaine, which belongs to Mosaic Co.
The company announced Thursday that work has been completed on a pre-feasibility study at its Legacy potash project in Saskatchewan, and the results have convinced the company to move forward to the feasibility stage.
The Legacy mine, which would use a method that uses water to dissolve minerals for extraction, would have a 40-year life and produce 2.5 million tonnes per year of potash, with initial startup targeted for the fourth quarter of 2013.
The world's biggest producer, Potash Corp. of Saskatchewan (TSX:POT), has several mines in the province but announced this week that it was cutting its 2009 output target again because of a late U.S. fertilizer season and slow negotiations with overseas customers.
The Potash One announcement comes just weeks after prominent mining promoter Robert Friedland was elected as Potash One's chairman, with the promise of helping introduce new Asia-based investors to the company.
At the time, Friedland - who has played key roles in the development of the Voissey's Bay nickel discovery in Labrador and the Oyu Tolgoi gold-copper project in Mongolia - said that he decided to join Potash One's board because of the importance of the Legacy project to Asian agriculture.
"The pre-feasibility study confirms the stature of Potash One as one of the most attractive new opportunities to develop an important Potash operation," Friedland stated, calling potash "the mineral of life."
The Legacy project spans 38,896 hectares about 80 kilometres north-west of Regina.
Potash president and CEO Paul Matysek said the study estimates "confirm our view that the Legacy project has the potential to become a high quality, long-life potash solution mine with robust economics."
Potash One shares slid four per cent, or 14 cents, to $3.41 on the Toronto Stock Exchange in late day Thursday.
15:14ET 18-06-09
