Australian Potash Ltd (ASX:APC) has lodged tenement applications covering large areas of Lake Wells in Western Australia that are contiguous to the company’s Lake Wells SOP Project (LSOP).
The application area, which was previously held by Salt Lake Potash Ltd (AIM:SO4, ASX:SO4, OTC:WHELF), will expand the LSOP by 1,212 square kilometres to 1,905 square kilometres.
APC has reported an Exploration Target (NYSE:TGT) over the application area, named Lake Wells East (LWE), of between 9.5 million tonnes and 24 million tonnes of SOP (sulphate of potash).
Existing and new Lake Wells SOP Project tenure.
APC managing director and chief executive officer Matt Shackleton said: “The LSOP already holds the largest Australian measured SOP resource of over 18 million tonnes.
“We have taken the opportunity to potentially more than double the scale of the LSOP at minimal cost to our shareholders.
“The previous owner disclosed an MRE based upon a shallow trenching model, whereas the LSOP is defined by its low-risk borefield abstraction strategy, which allows us to estimate resources to a greater depth, providing more ‘ore’.
“The existing LSOP development carries an NPV of over A$1 billion.
“The enormous scale that the LSOP can grow to with the addition of 1,200 square kilometres of contiguous ground, over which we estimate an Exploration Target of between 9.5 million and 24 million tonnes of SOP, is clear.
“There is potential for the LSOP to become the largest shovel-ready solar SOP project on the planet.”
Exploration Target
In compliance with JORC 2012 and the recently adopted Guidelines for Resource and Reserve Estimation for Brines 2019, APC has reported an Exploration Target (ET) in terms of gravity recoverable brine as estimated by the Specific Yield (Sy) of the host lithology.
The measured potassium content in brine can be expressed in units of sulphate of potash (SOP or K2SO4) by multiplying by 2.23 and assuming complete conversion and no limiting reagent.
On this basis, the ET of between 4.3 million and 10.7 million tonnes of potassium results in 9.5 million to 23.9 million tonnes of SOP.
APC has therefore delineated a substantial target on which to base the necessary exploration and further planning.
Moving to a DFS
Shackleton added: “Western Australia is developing into the world’s frontier potash province, with SOP now being produced in WA, the LSOP at shovel-ready stage and several other projects from early-stage exploration to final permitting.
“Recently, there have been commercial transactions in the local and global SOP space that reflect the enormous value operating SOP projects can create.
“Our main focus is the development of the LSOP, however, we are planning to move to a definitive feasibility study on a combined, larger, expansion operation within three years.”
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