Salt Lake Potash Limited (ASX: SO4) extended its mineral resources estimate at Lake Way after completing an exploration program across the entire Lake Way Project. The company previously signed a Memorandum of Understanding on 9th March 2018 with Blackham Resources Limited (ASX: BLK), in which Blackham granted brine rights on its Lake Way tenement free from encumbrances to the company.
The MoU granted by Blackham to the company includes various exploration, mining, and prospecting licences. The company is determined for the development of the Lake Way Project as it is a high-grade salt-lake brine Sulphate of Potash (SOP) operation.
The company reported maiden mineral resource estimates in July 2018 after completing a scoping study for a 50,000 tpa demonstration plant, which was limited to the area within the Blackham Tenement boundary. Succeeding to the previous mineral resource estimation, the company undertook an extensive exploration program which covered the remaining area of the Lake Way including the Playa surface. The exploration includes the delineation of the Paleochannel which runs along the eastern boundary of the project.
An independent hydrogeological consultant Groundwater Science Pty Ltd completed the Mineral resource estimation. The mineral resources of the project are classified as; Lake Bed Sediment, Paleovalley Sediment, and Paleochannel Basal Sands.
The project is in the northern goldfields region of Western Australia and is confirmed as a very high-grade tenement with an average grade of 14.5kg of SOP per cubic meter delivered significant results such as;
Measured resources for the Lake Way Playa included 6.9Mt @ 15.4kg per cubic meter and the measured resources for the Williamson Pit included 32Kt @ 25.5kg per cubic meter.
The indicated resources for the Paleochannel included 3.7Mt @ 13.6Kg per cubic meter and inferred resources at the Lake Way playa, and Paleovalley Sediment included 62Mt @ 13.6Kg per cubic meter. The significant results from ‘Whole of the Lake’ led to the total mineral resources estimation of 73 million tonnes of Sulphate of Potash (SOP) calculated using Total Porosity and 8.2Mt of SOP calculated using Drainable Porosity.
As per the company, the SOP tonnage has no recovery factor applied to it. The total amount of contained brine which can be extracted will depend upon factors such as permeability of the sediments, the drainable porosity and the recharge dynamics of the aquifers among various other such factors.
The Mineral Resource Estimate for the ‘Whole of Lake,’ which delineated SOP resources, will now enable the company to finalise technical studies for a large production scenario by the end of Q2 2019.
As per the CEO, Mr. Tony Swiericzuk, the high grade and significant results for the Lake Way reinforces the company’s current review process to consider a larger scale scenario. Previously the company commenced its construction of the lake way’s ponds after receiving DWER permits.
As per the company, it will continue the exploration program to increase the resource definition and convert the mineral resource estimate into Ore Reserve.
During the time of writing this report, the shares of the company are trading at A$0.575 (as on 18th March 2019, 03:39 PM), flat as compared to its previous close.
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