The company applied to have the licences extended in November 2003 and believes it is “fully entitled” to the extension under the provisions of the concession agreement. However, in December 2003, the DPM questioned Asia Pacific’s right to extend or renew the licences.
The advanced Udon North project has an indicated resource of 175 million tonnes grading 19% K2O, with an averaging thickness of 12 metres. An additional 490 million tonnes of 16.5% K2O are classified as inferred resources, and also average 12 metres.
The project still requires an approved environmental impact assessment (EIA) and various other government approvals.
“The company continues to focus on obtaining the mining licence and is working closely with the government of Thailand to expedite the issue of mining regulations under the Minerals Act and the procedures for a public hearing,” says Asia Pacific CEO John Bovard. “The discussion regarding the special prospecting licences for Udon North has no impact on our plans for the major Udon South deposit.”
Udon South already has an approved EIA, and the company has completed all technical studies.
Asia Pacific recently agreed to form a joint venture with Chinese state-owned Enterprise Investment in order to develop Udon South. Asia Pacific has a 90% interest in the project and is working to arrange long-term offtake commitments and US$300 million worth of financing for initial capital costs.
Udon South (formerly known as Somboon) contains 330 million tonnes of sylvite ore grading 24% K2O. Plans call for initial production of 1 million tonnes of potash annually, with a doubling of capacity planned as the company’s market share grows.
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