Global interest in Western Potashowned Milestone

first_imgIn an article published on focussing on potash industry developments in the wake of continuing high prices and record food demand, Western Potash, with arguably the world’s most advanced ‘independent’ potash project, is highlighted as a company getting a lot of attention from potential state-funded buyers. The company has just published a better-than-expected pre-feasibility study for its Milestone project in Saskatchewan, which some analysts believe make it very attractive to the world’s potash-hungry emerging super-powers. China, India and Brazil were cited as countries being very anxious to lock-in ownership of long-term overseas potash supplies.Weighing in Western Potash’s favour is the fact that Milestone boasts a projected annual production of up to 2.8 Mt of potash and it has an anticipated minimum 40-year mine life. Another big plus is that the pricing of this future output isn’t going to be set by Canpotex, the cartel that controls all of Saskatchewan’s existing potash sales. The project’s “independent” status is of significant strategic value to any end-user, such as a foreign fertiliser company, that buys into the 945 Mt resource, according to analysts. China would prefer not to have to buy much of its potash from Canpotex due to high pricing and Max Vichniakov, a Toronto-based analyst for the investment bank Octagon Capital, believes that India would also likely find it far more cost effective to deal with Western Potash. The Milestone property is adjacent to other potash projects owned by the mining giants BHP Billiton, Vale and Rio Tinto/JSC Acron and is the last junior-owned project that has not been bought out. However, John Costigan, a spokesperson for Western Potash, was quoted in the article and played down any suggestions that either a takeover or a joint venture deal is imminent. “Building further value into the Milestone Project is our focus right now, rather than completing any kind of industry transaction. At the same time, we want to continue to significantly de-risk the project by undertaking a full feasibility study,” he said.last_img

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