Wednesday, September 19, 2018Canada's Leading Online Business Magazine

Western Potash

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Founded on Exploration, Driven by Demand

Western Potash Corp., founded in mid-2007, is a junior mining company actively pursuing potash mineral properties in Western Canada. The company completed their IPO in May of last year, to which there was a phenomenal response. Before going public, Western Potash raised over $20 million, and raised another $26 plus million after the offering. Things are going well for the relatively new company, says Pat Varas, and the support so far is definitely an indicator of “the regard for the Western Potash team and our ultimate potential”. He adds “if you’re an investor, we’re a great company to take an interest in”.

Indeed, Western Potash surely has some very competitive advantages. Firstly, the company currently has three key properties that are permitted for exploration, in Southwest Manitoba along the Saskatchewan border. This property covers 1000 km² and brings together two potash deposits, that potentially host over 1 billion tonnes of potash. The company has also been granted 50,000 hectares of Saskatchewan exploration permits. They have also applied for an additional 150,000 hectares in Southern Manitoba.

Unprecedented potential
Western Potash is confident that the adjoining Manitoba deposits have a combined resource that could yield an estimated in situ value of $40 billion – a whopping potential for a junior company. The company is also one of a very few potash companies in Canada that can participate in global production, so the competitive landscape is ideal. The other advantage, says Pat Varas, President of Western Potash, is that currently 85% of Canadian potash mines are operating at or near capacity. Presently, global potash production is at full capacity. Demand has begun to outstrip supply. “There have been no new potash mines on the prairies in almost 40 years” says Varas. “If you are working at capacity, it’s not like you can just mine more.”

The other advantage Western Potash boasts is the region in which they’re exploring. “We’re exploring in an area that has never been accessible for potash exploration in the past. The other juniors are working in areas that have seen exploration in the past. You can say that we’re the only company exploring for new potash mineralization in the potash belt” Varas explains.

Exceptional regional infrastructure
Western Potash is very lucky to be in an unexplored area with great infrastructure, and can add this benefit to their list of competitive advantages. For the company, this infrastructure makes for especially robust project economics. “Our location is superior. We’re not that far from a local town, and we’re exploring in farmland. We have railway access in all directions, but especially important for us – we have ready access to the U.S. mid-west” Varas explains. The U.S. border is only 55 kms to the south of the company’s locale, providing easy access to one of the world’s largest potash markets.

Not looking to build the “next big mine”
Although the company is strategic about its objectives, Varas says that developing the next big potash mine is not the primary goal for Western Potash. “Our goal is not to establish Canada’s next large conventional mine – you need a tremendous amount of capital for that. We would like to explore and develop a project that is technically-sound and take it into a feasibility study. Then, we want to look for partners, whether they are government or private sector partners. We want to establish joint ventures.”

In essence, says Varas “You don’t need to have big mines to have a profitable operation. A lower capital cost , lower volume, scaleable solution mine, situated on our Saskatchewan property is a realistic mining option”.

Of course, it doesn’t hurt that the local appreciation and demand for jobs in Manitoba is on the company’s list of advantages. Varas assures that “Manitoba wants mining”. Why? Because with mining and resource development comes local jobs, infrastructure, and economic sustainability for one of Canada’s most valuable Western provinces.

A strong, proven management team
Western Potash has a large cash
position, but the company’s management team is the foundation of the company, says Varas. “One thing potential investors can be sure of – you will get quality exploration out of our team, and with that comes an invaluable amount of experience.” Varas himself has a long history of experience – over 23 years as a Professional Geoscientist engaged in exploration, project and corporate management. He has been part of major and junior mining companies in exploration projects that span the globe. Collectively, the Western Potash management team has proven itself in several world-class discoveries that include the Lihir Gold discovery, the Diavik Diamond discovery, and the Santo Domingo Copper discovery.
Varas hopes that along with the stellar management team, “the quality of our projects will eventually speak for themselves” adding “the supply and demand for potash will ultimately drive our success”.

He says “the fundamentals for potash are so great – it all boils down to the growing demand for food, which will require optimum fertilization to maintain and/or increase current yields – and potash is an essential ingredient in fertilizers. Ultimately, we need to increase the global potash resources to support this demand”. In the coming years, the company intends to continue to define and develop a world-class potash deposit, while providing its shareholders with a unique opportunity to participate in the blue-chip dominated potash mining industry. The company is on the move – searching for potential mineral properties to add to its potash portfolio.

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