POTASH ONE INC. : http://www.potash1.ca/ : QwikReport

Potash Legacy Project

Potash One Inc., is a Canadian based company, which is focused on developing its Legacy Project, a feasibility stage solution mining potash project in Saskatchewan. The Legacy Potash Project is located approximately 80 kilometers northwest of Regina and is immediately adjacent to Mosaic's Belle Plaine potash solution mine, the largest potash solution mine in the world. The project consists of 97,240 acres of Crown mineral lands held by Subsurface Mineral Permit KP 289.

Legacy Project
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Potash One announced a significant increase to the Legacy Project's Resource Estimate in May 2009 with an updated National Instrument 43-101 Report expanding and upgrading the estimated resource to:


The Potash Resource is the estimated metric tonnes of refined potash product, taking into account the recovery by solution mining and processing losses (i.e. extraction factor, cavern recovery factor, geological anomaly factor, and processing losses). A cutoff grade of 15.8% KCl and a radius of influence from cored drill holes of 0.8, 1.6 and 8 km were used for the Measured, Indicated and Inferred areas respectively.

During the Resource Confirmation drilling program, Potash One drilled six holes totaling more than 9,000 metres. All 6 drill holes were located within an area of approximately 35 km2 on a 3.2 km (2 mile) spacing that forms the Resource Confirmation Area (RCA). Results of the resource confirmation drilling can be found here.



Subsequent to favorable results announced on the Legacy Project's Pre-Feasibility Study (PFS), Potash One initiated a full Feasibility study in October 2009. The Feasibility Study will provide a comprehensive overview of all aspects of the project, including land and mineral rights, processing, transportation and logistics, port space options, a detailed market analysis, refined capital and operating cost estimates, and financial performance metrics.

Highlights of the Legacy Project's Pre-Feasibility Study in June 2009 included the following projections:

Initial Mine Life

40 years

Annual Potash Production

2.5 million tonnes/year of KCL

Estimated Capital Cost

$1.877 billion USD

After-tax payback period

3.3 years

Estimated after-tax and royalty Internal Rate of Return

30.1%

Estimated Net Present Value (NPV) after tax (10% discount rate)

$4.47 billion USD

Paul F. Matysek, President and CEO of Potash One stated, "On the anniversary of our Toronto Stock Exchange Listing, the completion of the Pre-Feasibility Study represents a significant milestone in the development of the Legacy Solution-Mining Project. The PFS study estimates confirm our view that the Legacy Project has the potential to become a high quality, long-life potash solution mine with robust economics. We have a sizeable resource, a best in class technical team and a strategic plan for international capital investment. By utilizing proven solution mining technology, we believe that Potash One will develop a scalable, low risk mining operation which could see its first production as early as Q4 2013."

The Company also carried out approximately 271 linear kilometres of 2D seismic and approximately 73 km2 of 3D seismic surveys. The completed 2008 - 2009 Potash One drilling program focused exclusively on the southern area of the KP-289 lease. The southern target area has the potential for expansion to the west, north, and east.

Solution Mining is the use of hot water to dissolve a desired mineral from a geological ore zone into solution through directional or vertical boreholes or abandoned underground mine workings. The solution is then pumped back to the surface where the solution potash is crystallized and purified into the finished product, ready to be transported and sold to market.

Solution mining technology has the direct benefits of scalable production capacity, lower capital costs, quicker timeline to production, and with significantly less mining risk as compared to conventional potash operations.
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This page was created on Tue Sep 7, 2010 at 6:22:52 PM Pacific Time.