Western Potash Milestone project has feasibility confirmed by study

Western Potash Corp. announced Thursday the results of a feasibility study on the company’s Milestone project near Kronau, confirming the orebody’s size and grade could support potash solution mining for more than 40 years at full production of 2.8 million tonnes per year.

The study from AMEC Americas Ltd. reports that the resulting after-tax net present value of the project is $2.44 billion, the Vancouver-based junior mining company said in a press release.

“Our project is in an enviable, low-risk geopolitical and regulatory jurisdiction, which is a key advantage for developers that look for longterm investment predictability,” Patricio Varas, Western’s president and CEO, said.

“The lower capital intensity of the project combined with the plant’s ef- ficient operations and high throughput produce a project with attractive rates of return and significant free cash flow.” These factors, combined with the size and grade of the deposit, and the expertise of the project’s

“OUR PROJECT IS IN AN ENVIABLE,

LOW-RISK GEOPOLITICAL AND REGULATORY

JURISDICTION.”

PATRICIO VARAS

management team, present a “unique opportunity for investors and developers to secure an economical, reliable and long term supply of potash,” Varas said.

Western Potash recently announced a “definitive agreement” has been signed with the City of Regina securing the long term source of process water for its pro- posed potash solution mine about 30 km southeast of Regina.

Under the agreement, which was first announced in June, the company will have access to 60,000 cubic metres per day of treated effluent for the first six years and 42,240 cubic metres for the remaining 39 years. This amount is sufficient to supply process water for the solution mine during the life of the mine.

The agreement will be worth more than $200 million to the city throughout its 45year term. The company will also fund the construction of the pipeline and associated infrastructure to deliver the treated effluent water to the mine site located.

The Milestone potash solution mine, if approved, could begin construction in 2013 or 2014 and become operational in 2016. The $2.8-billion project could employ up to 1,500 jobs during construction phases and 300 to 350 permanent jobs at the mine.