Vancouver – Little more than a month since closing an $11-million financing, Potash One (KCL-V, KCLOF-O) — which recently changed its name from ISX Resources — is going back to the market looking for a further $14 million to fund planned development of its Legacy potash project in south-central Saskatchewan.
The aspiring potash miner plans to sell 3.5 million units (comprised of a share and a half-warrant) at $4.00 apiece in the non-brokered private placement. Whole warrants will be exercisable at $4.75 for 15 months but can be accelerated to a 30-day expiry should the common shares close at or above $6.00 for ten trading days.
Potash One has an option to acquire a 39,350-hectare potash subsurface exploration permit in Saskatchewan, the Legacy project (previously called Findlater), that underwent prior exploration by Imperial Oil Ltd (now Exxon) and Lumsden Potash Development.
An early-2007 technical study of Legacy identified three main intervals containing sylvinite (a mixture of potassium chloride and sodium chloride and the main ore for potash production) with potential economic interest: the Patience Lake, Belle Plaine and Esterhazy members.
An indicated resource of 36.8 million tonnes of K2O was reviewed plus an additional 360.4 million inferred tonnes K2O both in the Patience Lake and Belle Plaine potential solution mining intervals.
A further 4 million indicated tonnes plus 31.1 million inferred tonnes K2O was also tabled if the solution mining recovered the potash occurring between the two main evaporite beds.
Grades generally range from 19-22% K2O.
The deposit consists mostly of flat-lying sedimentary deposits of interbedded halite, sylvite, carnallite, clay, and minor anhydrite and dolomite beds.
Legacy is located north of and adjacent to Mosaic‘s (MOS-N) Belle Plaine solution potash mine.
The solution mining process consists of injecting heated water into the sylvinite-bearing seams where it is dissolved and then brought to surface through extraction wells. The solution, or brine, is processed through a refinery to recover the potash.
Worldwide potash demand for use in the fertilizer industry has been strong, driven by increasing demand from developing countries particularly China and India.
Shares of Potash One jumped 10% on the news, closing up 41 to $4.41 apiece in February 21st trading.
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