Potash North NI 43-101 Report Filed
VANCOUVER, BRITISH COLUMBIA–(Marketwire – July 8, 2008) – Potash North Resource Corporation (“Potash North” or the “Company”) (TSX VENTURE:PON) is pleased to announce it has received a Technical Report compliant with NI 43-101 for its KP 416, KP 417 permit areas located in south eastern, Saskatchewan. Dr. Michael Hardy of Agapito Associates Inc. of Colorado, USA and Steve Halabura of North Rim Exploration of Saskatoon, Saskatchewan authored the report.
The Permit Area is in close proximity to existing rail, road, and electrical grids and is located immediately north of existing commercial potash mines operated by Mosaic Potash and the Potash Corporation of Saskatchewan. The Permit Area is located approximately 35 kilometers (km) northeast of the town of Esterhazy and approximately 20 km northeast of the operating Esterhazy, K1, and K2 underground potash mines owned by Mosaic Potash Esterhazy. The southernmost boundary of the KP 416 permit area is located some 45 km from the Potash Corporation of Saskatchewan’s Rocanville Mine.
Four cored and assayed holes that have commercial-grade potash intersections are available and have been inspected by Dr. Michael Hardy and Mr. Steve Halabura. The length-weighted average grade for the Belle Plaine and Esterhazy intersections from those four holes is listed in Table 1. Three other holes were cored within the Permit Area but did not intersect potash mineralization because they were either not deep enough to penetrate the potash bearing zones or show evidence of leaching of the potash mineralization.
Table 1. Length-Weighted Average Assay Results ——————————————————————– —— ——————————————————————– —— __________________________________________________________% Carn- __________________________________________________________allite ____________________________ Depth__Thick- __________________(KCl.__% Water Geologic__________________Interval__ ness__________________MgCl2.____Insol- Unit______ Drill Hole__________ (m)____(m)__% K2O__% KCl____6H2O)____ubles ——————————————————————– —— Belle______DH12 Southwest____820.5-__ 1.8____25.8__ 40.8____ 0.3______ 2.1 Plaine____ Potash Corp.______822.3 Member____ DH14 Southwest____833.0-__ 3.4____18.3__ 29.0____ 3.8______ 4.6 __________ Potash Corp.______836.4 ——————————————————————– —— __________ DH01 Canberra____ 791.2-__ 3.3____21.5__ 34.1____ 9.7______ 0.9 __________ Langenburg________794.5 Esterhazy__DH03 Canberra____ 837.6-__ 3.6____21.6__ 34.1____11.8______ 0.7 Member____ Langenburg________841.2 __________ DH14 Southwest____857.6-__15.7____ 9.2__ 14.5____ 8.9______ 1.0 __________ Potash Corp.______873.3 ——————————————————————– —— ——————————————————————– ——
Historical data suggests that the northern limit of the Belle Plaine Member intersects the western portion of the Permit Area and that the Esterhazy Member is truncated through the Permit Area. The exact positions of the truncation lines are presently unknown; nonetheless, drill-hole data indicates that there is significant area within the Permit Area that is underlain by potentially mineable potash in the Esterhazy Member.
This historical drill hole data is reported for information purposes only since the drilling data was collected prior the development of the NI 43-101 reporting standards. This drilling information has not been verified by Potash North and therefore should be considered unreliable until further work confirms such results. Currently there is no measured, indicated or inferred resource in the Permit Areas.
The potash mineralization identified in the Permit Area from drill-hole data consists of two principal members: the Belle Plaine and Esterhazy. These members were identified by Mr. Halabura based on assays, cores, core descriptions and gamma ray logs, all available from the Saskatchewan Ministry of Energy and Resources located in Regina. Seven of the fourteen drill holes identified in the immediate proximity of the Permit Area penetrate the potash- bearing beds. Of these, four (DH01, DH03, DH12, and DH14) have sufficient assayed core to allow the calculation of potash mineralization thickness and grade, and all four are located within the Permit Area. Of the remaining three holes (DH02, DH05, and DH10) that cored through the Prairie Evaporite Formation, no assay data is available because they are interpreted to be “leach” anomalies. The remainder of the historical holes were not drilled deep enough to penetrate the potash bearing zone.
The average thickness and weighted-average potash grade expressed as “percent potassium oxide” or “% K2O” and the insolubles based on the averages for four cored locations, two for each member sited in the northwestern corner of KP 417 for Belle Plaine Member (DH12 and DH14) and southeastern corner of KP 416 for the Esterhazy Member (DH01 and DH03) are listed below:
Belle Plaine Member: 2.70 meters averaging 21.89% K2O, 3.40% insolubles and 2.13% carnallite
Esterhazy Member: 3.45 meters averaging 21.55% K2O, 0.80% insolubles, and 10.80% carnallite
Additional work is required to further investigate three areas of risk:
1. Continuity risk: This risk is the uncertainty concerning the continuity of potash mineralization. The distribution of core holes with potash mineralization intermixed with core holes without significant potash intersections suggests a complex depositional and post-depositional history. The barren holes are interpreted to be due to collapse anomalies and leached zones which may be localized in extent. Two- and three-dimensional seismic surveys are necessary to establish the continuity of potash mineralization in the Permit Area and to determine the northern limit of mineralization.
2. Quality risk: This risk is the uncertainty concerning the quality of potash mineralization and the distribution of carnallite, particularly in the Esterhazy Member. This risk can be mitigated with additional core analysis of future holes and evaluation of the impact of carnallite on mining and processing.
3. The thickness and continuity of the salt back: The thickness of the salt interval between the top of the selected mining horizon to the top of the Prairie Evaporite Formation, commonly referred to as the “salt back”, is an important parameter in safe mine design and operation. The salt back controls the need for ground support and the acceptable mining roof span and typically a salt back thickness from 6 to 10 m is required for safe and efficient mining using conventional underground mining techniques as in use at Mosaic’s Esterhazy Mine and PCS’s Rocanville Mine. This risk can be mitigated by gaining a better appreciation for overall thickness and distribution of the Esterhazy Member, and rock mechanical studies to determine a reasonable salt back thickness.
In order to estimate the potash potential of the Permit Area, the Technical Report recommends conducting a 2D seismic survey followed by local 3D seismic surveys and selected drilling to establish the continuity of the mineralization by identifying portions of the ground that may contain anomalies that affect potash mineralization.
A three-phase exploration is recommended for advancement of Potash North’s property in the KP-416 and KP-147 Permit Areas. The exploration program includes engineering studies as the project matures from a prospect to a commercial mine plan. The three phases outlined below take the project through Preliminary Feasibility, should each preceding phase bear a favorable recommendation to proceed. The plan outlined below does not consider activities specifically required for permitting and compliance with environmental regulations.
Design and implement an extensive 2D Seismic Survey of the Permit Areas – estimated cost $1.5 to $2.5 million depending upon final design of line layouts;
Drill three to five core holes to intersect and sample the potash Members. The location of the holes would be selected after the 2D seismic survey has been completed and interpreted. The holes would be located to establish and confirm a potential reportable resource in compliance with NI 43-101 standards and would include at least one hole close to an existing core hole for verification of the historical core-hole data. Estimated Cost: $3 to $5 million;
Complete a Preliminary Assessment in compliance with NI 43-101. This includes development of a geologic model, a proposed mine, process, and marketing plan, and preliminary capital and operating costs for the project. The Technical Report may identify NI 43-101 compliant Resource. Estimated Cost: $500,000;
Complete a 3D seismic survey in the areas of highest potential for commercial mining. Estimated Cost: $3 million.
Drill additional holes as necessary to confirm the extent of potash and anomalies in the area of the mine plan and provide preliminary input for shaft design and groundwater control. Estimated Cost: $3 to $6 million.
Complete a Preliminary Feasibility Study to establish project costs and define Reserves in compliance with NI 43-101 standards. Estimated Cost: $3 million.
The complete Technical Report has been filed on SEDAR and the Company’s web site.
Potash North is currently negotiating service contracts and will commence the recommended Phase I program as soon as practicable.
The technical content in this news release has been read and approved by Stephen P. Halabura P. Geo., a consultant to Potash North and Principal Geologist and Owner of North Rim Exploration Ltd., a Professional Geologist licensed in Saskatchewan and a Qualified Person as defined by NI 43-101. Mr. Halabura is independent of Potash North.
ON BEHALF OF THE BOARD
Craig A. Angus, President
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