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Undoubtedly, the growing population is driving demand for food across the world. Inensification of agriculture required to satisfy this increased demand further depends on fertilisers for improving the productivity. Tapping the emerging opportunity is an Australian headquartered feedstock explorer- Parkway Minerals NL (ASX: PWN) that is catering to this growing need of fertilisers by focusing on the sustainable production of fertiliser minerals.
The company has created a portfolio of high-quality resource projects that are ideally suited for potential development via either the K-Max® or aMES⢠(activated Mineral Extraction System) technology, in case a proper feasibility-study endorse a commercial-scale development.
The companyâs project portfolio comprises of Karinga Lakes Potash Project (KLPP), Dandaragan Trough Project (DTP), New Mexico Lithium Project (NMLP) and Davenport Potash Project Portfolio (ASX: DAV). The company also owns 5.6 million shares in Lithium Australia NL (ASX:LIT).
The September quarter was a revolutionary quarter for Parkway in 2019 as the company achieved a significant milestone via the acquisition of 98.83 per cent interest in Consolidated Potash Corporation (CPC).
The company has recently released its quarterly report for the period ended 30th September 2019 on the ASX, that highlighted the following developments:
Acquisition of Consolidated Potash Corporation
The company completed the 98.83 per cent acquisition of CPC on 17th September 2019 during the quarter, after receiving shareholder approval at an EGM on 13th September 2019. Subsequent to the quarter, Parkway finalised the acquisition of the remaining 1.17 per cent of CPC after the minority shareholders signed agreements, paving way for 100 per cent acquisition.
The acquisition represented a transformative transaction for the company that enabled it to acquire a 100 per cent interest in the aMES⢠brine-processing technology and earn equity interests in CPCâs two strategic brine projects â KLPP (15% interest, earning 40%) and NMLP (70% interest, earning 100%).
Parkway issued ~480 million shares and ~123 million partly paid shares to the CPC vendors and transferred 10 million DAV shares to Lions Bay Capital (as part payment for CPC acquisition) during the quarter. The company thus got two new substantial shareholders:
- Lions Bay Capital that owns ~223 million shares (18.36 per cent)
- Activated Logic Pty Ltd that owns ~204 million shares (16.78 per cent)
The company also raised $450,000 during the quarter to fund the CPC transaction and working capital requirements, issuing 90 million shares at $0.005.
Coinciding with CPC acquisition, Bahay Ozcakmak (MD and major shareholder of CPC) and Patrick Power joined Parkwayâs board as executive and non-executive directors, respectively.
aMES⢠Technology Platform
Several brine project developers and operators have validated the potential of aMES⢠technology to deliver substantial value and improve the overall performance of the project.
With aMES⢠technology, the concentrated brine solutions can be treated to retrieve valuable minerals and fresh water. The technology has the following advantages:
- Improves product quality and mineral recovery,
- Offers opportunity for substantial project opex and capex savings,
- Produces pure water as a by-product and ensures efficient use of energy,
- Improves environmental sustainability and project footprint.
Source: Companyâs Presentation (28th October 2019)
CPC is assessing the prospective suitability of the aMES⢠to be implemented to existing lithium and potash brine operations to enhance product recovery and quality, along with reducing fresh-water consumption.
Karinga Lakes Potash Project
Parkway initially has 15 per cent interest in Karinga Lakes Potash Project, a Joint Venture with Verdant Minerals, with the right to acquire up to 40 per cent interest through a staged investment of additional $2 million. CPC delivered a successful scoping study to Verdant Minerals in February 2019, under which the potential development of KLPP based on the aMES⢠technology was investigated.
Parkway is working with the JV to identify the suitable opportunity to finalise a Preliminary Feasibility Study (PFS) for KLPP based on the strategic application of the aMES⢠technology. The KLPP-PFS is likely to assist in aMES⢠roll-out and further demonstrate the advantages of the technology.
New Mexico Lithium Project
Parkway has gained a 70 per cent interest in NMLP post acquisition, with the right to move to 100 per cent ownership. The project displays important geological components, including:
- Source - lithium-bearing volcanic rocks
- Scale - large catchment area to accumulate lithium
- Concentration - located in a geothermally active region
- Trap - closed central playa in an arid environment
At present, the company is engaged in the evaluation of multiple opportunities to drill-test NMLP, including an alliance with potential third parties.
Grant of Retention Status to the Dinner Hill Project
Parkway holds 100 per cent stake in Dinner Hill potash and phosphate deposit that forms a large part (about 40km2 area) of the DTP, wherein sedimentary sequences contain a potash rich mica, glauconite and phosphate nodules.
Source: Companyâs Report (7th January 2019)
Parkway notified that a retention status was given to the Dinner Hill Project during the quarter, permitting the company to progress with its development plans with marginal holding costs. The company is exploring metallurgical process optimisation opportunities at DTP while embarking on potential JV partner engagement.
Davenport Resources
Parkway also holds 34.3 million shares (21% interest) in Davenport, whose South Harz Project has a total Inferred Resource of 4.9 billion tonnes @ 10.6% K2O, comprising 1.6 billion tonnes of sylvinite @ 13.1% K2O. The company has completed the economic and technical studies on many potential opportunities within the existing project portfolio, which will form the basis of strategic partner discussions.
Parkway reported a cash balance of $0.33 million and liquid assets of $0.25 million as at 30th September 2019. The company has estimated a total cash outflow of 0.21 million for the next quarter.
PWN closed the trading session at $0.006 on 1st November 2019. The stock has provided a return of 100 per cent in the last six months.
Take a Look at Parkwayâs FY19 Annual Report Here
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