Asia Pacific seeks Udon North resolution (February 18, 2004)

Asia Pacific Resources (APQ-T) and the Thai Department of Primary Industry and Mines (DPM) will look for an independent referee to decide the fate of the Toronto-based junior’s special prospecting licences for the Udon North potash deposit.

The company applied to have the licences extended on Nov. 5, 2003, and figures it is “fully entitled” to the extension under the provisions of the concession agreement. However, in December, the DPM questioned Asia Pac’s right to extend or renew the licenses.

The advanced Udon North project is home to an indicated resource totalling 175 million tonnes running 19% K₂0 and averaging 12 metres in thickness. An additional 490 million tonnes of 16.5% K₂0 is classified as inferred resources, and also averages 12 metres.

If Asia Pacific’s licences are extended at Udon North the project still needs an approved environmental impact assessment (EIA) and other various government approvals to advance.

“The company continues to focus its efforts 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 licenses for Udon North has no impact on our plans for the major Udon South deposit,” he adds.

Udon South already has an approved EIA in place and the company has completed all detailed technical studies.

Asia Pacific recently agreed in principle to form a joint venture with Chinese state-owned Enterprise Investment in order to develop Udon South. Asia Pacific owns a 90% interest in the project, and is working to arrange long-term off-take commitments and US$300 million worth of financing required 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.