Salt Lake Potash Limited (SLP or the Company) is pleased to provide an update on the Company’s Lake Way project since following execution of an MOU with Blackham Resources Limited’s (Blackham) outlining the potential to incorporate Blackham’s Mining Lease tenure into the development of a Sulphate of Potash (SOP) operation.
Highlights of work completed include:
Surface Sampling Program
- A preliminary surface sampling program on Blackham’s tenements confirms the Lake’s average SOP grade of over 14kg/m3, making Lake Way one of Australia’s highest grade SOP brine sources.
- An initial geological and geotechnical investigation by the Company and Knight Piesold confirmed the availability of in-situ clays amendable for on-lake evaporation pond construction. A total of 24 auger holes were excavated across Blackham’s tenements and laboratory tested.
Surface Aquifer Exploration
- Review and modelling of the large volume of historical exploration data for Lake Way confirms the likelihood of a large hypersaline brine pool on both Blackham and SLP’s tenements.
- The Company is in the process of mobilising a drill rig and an amphibious excavator on the Lake to complete an initial surface aquifer exploration program.
- The surface aquifer program will include the construction of test pits and trenches for long-term pump testing.
- The Company has commenced a range of process development testwork including process pathway modelling by international experts, a bulk sample evaporation trial and site-based evaporation trial at Lake Way.
Salt Lake Potash #SO4 CEO Matt Syme said: “These initial results are very pleasing and support the Company’s view that Lake Way is an ideal site for our SOP Demonstration Plant and subsequent expansions. It appears to have the best combination in Australia of scale, brine chemistry, playa surface, shallow clays for pond construction, permitting pathway and infrastructure access, which should result in substantial time and cost advantages.”
Lake Way is located in the Goldfields region of Western Australia, less than 15km south of Wiluna. The surface area of the Lake is over 270km2.
The Wiluna region is an historic mining precinct dating back to the late 19th century. It has been a prolific nickel and gold mining region and therefore has well developed, high quality infrastructure in place.
The Goldfields Highway is a high quality sealed road permitted to carry quad road trains and passes 2km from the Lake. The Goldfields Gas Pipeline is adjacent to SLP’s tenements, running past the eastern side of the Lake.
SLP has entered an MOU with Blackham to investigate the development of an SOP operation on Blackham’s existing Mining Leases at Lake Way including, initially, a 40-50,000tpa Demonstration Plant (see announcement dated 12 March 2018).
Lake Way has some compelling advantages which make it potentially an ideal site for an SOP operation, including:
- Substantial likely capital and operating savings from sharing overheads and infrastructure with the Wiluna Gold Mine, including the accommodation camp, flights, power, maintenance, infrastructure and other costs.
- The site has an excellent freight solution, adjacent to the Goldfields Highway, which is permitted for heavy haulage 4 trailer road trains to the railhead at Leonora.
- A Demonstration Plant would likely be built on Blackham’s existing Mining Licences, already subject of a Native Title Agreement.
- SLP would dewater the existing Williamson Pit on Lake Way, prior to Blackham mining, planned for early 2019. The pit contains an estimated 1.2GL of brine at the exceptional grade of 25kg/m3 of SOP. This brine is potentially the ideal starter feed for evaporation ponds, having already evaporated from the normal Lake Way brine grade, which averages over 14kg/m3.
- The high grade brines at Lake Way will result in lower capital and operating costs due to lower extraction and evaporation requirements.
- There would be substantial savings to both parties from co-operating on exploration activities on each other’s ground.
- The presence of clays in the upper levels of the lake which should be amenable to low cost, on-lake evaporation pond construction.
SLP will complete a Scoping Study for a potential SOP operation at Lake Way, including a Demonstration Plant, by mid-2018, in time to allow a decision on dewatering the Williamson Pit under the MOU. There is substantial historical data available for Lake Way and, along with the extensive, high quality technical work undertaken at SLP’s other lakes, which has substantial application at Lake Way, a Scoping Study can be undertaken in a much shorter timeframe than would normally be the case.
Surface Sampling Program
The Company has now completed initial surface sampling program at Lake Way, substantially covering the Lake surface. A total of 23 pit samples have been collected encountering brine at a standing water level generally less than 1 metre from surface.
The average brine chemistry of the samples was:
The brine chemistry at Lake Way is very consistent over the lake surface. The SOP grade are amongst the highest achieved in Australia to date.
To gain an understanding of ground conditions for trenching and pond construction, a preliminary geotechnical investigation program was undertaken within the Blackham Mining Tenements, in conjunction with leading international geotechnical consultants, Knight Piesold.
A total of 24 hand auger boreholes were drilled to depths of up to 3.2 metres, and the encountered soils were logged and sampled.
Lake Way ground conditions consists of a thin surface layer of evaporite sands, overlying sandy and silty clays. Firm clays were encountered at 1m to 2m depth, generally increasing in strength with depth, becoming hard from 2m to 3m. Shallow groundwater was encountered on average 0.2m below the lake surface.
A testing program was undertaken at a NATA accredited geotechnical laboratory, using specific test methods appropriate for saline conditions, to characterise soils and assess preliminary soil parameters.
Summary test results are presented below.
Erodibility characteristics were tested and an Emerson class number of 6 was measured for all samples. This indicates non-dispersive soils that are not prone to erosion when used to form embankments.
Based on the preliminary geotechnical work to date, Knight Piesold have concluded that:
- The in-situ clay materials can be expected to provide natural low permeability layers to control seepage of on-lake ponds.
- The clays are suitable for embankment construction purposes, with adequate moisture control and borrow pit dewatering.
- A key advantage of Lake Way is the presence of a drier clay zone surrounding the Williamson Pit, which has the potential to provide borrow materials and construction schedule benefits for the upcoming pond construction programs.
Knight Piesold is now preparing an options study to evaluate design concepts for large-scale pond systems and provide earthworks quantities and costs. Seepage assessments and flood studies are underway. In parallel, design work is being undertaken for a dewatering pond to hold the Williamson Pit brine.
Surface Aquifer Characterisation
Lake Way and its surrounds have been the subject of a substantial amount of historical exploration for gold, nickel, uranium and other minerals, as well as for process water for mining operations. A total of over 2,800 holes have been drilled in and around the Lake previously, providing a very large database of geotechnical information.
SLP have commenced compiling, digitising and interpreting the historical exploration database to extract relevant data and provide initial basement geometry for the Lake area, to assist estimation of an initial JORC compliant resource.
The Company is also in the process of mobilising a small track-mounted drill rig and an amphibious excavator to complete an initial surface aquifer exploration program. This work will provide critical data for the hydrogeological model for the surface aquifer of the Lake, as well as geological and geotechnical information for infrastructure design and construction.
The surface aquifer program will include the construction of test pits and trenches for long-term pump testing.
The drill campaign is also intended to sterilise (for gold exploration) sufficient areas for siting brine extraction trenches and evaporation ponds.
The Company has commenced a range of process development testwork to provide and validate inputs to the Lake Way Scoping Study production model. Naturally, this includes testing brines from the Lake itself, as well as the super-concentrated brines from the Williamson Pit.
The testwork aims to confirm the modelled brine evaporation pathways firstly under laboratory simulated conditions and then from a site-based trial of sufficient scale to test on-lake evaporation conditions.
Initial brine evaporation modelling, conducted by internationally renowned solar pond experts, Ad Infinitum, indicates the salts produced at Lake Way will be comparable to those produced at Lake Wells and therefore suitable for conversion into SOP.
International laboratory and testing company, Bureau Veritas (BV), has commenced a series of laboratory-scale brine evaporation trials at their Perth facility, under simulated average Lake Way climate conditions. The aim of the BV trials is to monitor the chemical composition of the brine and salts produced through the evaporation process to confirm:
- Concentration thresholds in the brine chemistry which can be used to maximise the recovery of potassium in the harvest salts and minimise the quantity of dilutive salts fed to a process plant;
- The quantity and composition of harvest salts which will for the plant feed in commercial production; and
- The potential for any internal evaporation pond recycle streams that may improve harvest salt recovery.
Two tests – one for Williamson Pit brine and one for normal Lake Way brine – are currently underway, each evaporating 150kg of brine on a load cell to monitor evaporative loss. The temperature of the brine and air flow across the brine surface is controlled by using infra-red lamps and fans to simulate Lake Way average weather conditions.
A Site Evaporation Trial (SET), as successfully operated at Lake Wells previously, is under construction at Lake Way and will be filled with first brine over the next week. The SET will gather specific evaporation data on concentrated brines under actual conditions, providing refinements to the commercial scale pond modelling.
The Site Evaporation Trial is also designed to produce sufficient harvest salt for confirmatory process testwork and initial customer samples.
Competent Persons Statement
The information in this report that relates to Exploration Results, or Mineral Resources for Lake Way is based on information compiled by Mr Ben Jeuken, who is a member Australian Institute of Mining and Metallurgy. Mr Jeuken is employed by Groundwater Science Pty Ltd, an independent consulting company. Mr Jeuken has sufficient experience, which is relevant to the style of mineralisation and type of deposit under consideration and to the activity, which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Jeuken consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.
Forward Looking Statements
This announcement may include forward-looking statements. These forward-looking statements are based on Salt Lake Potash Limited’s expectations and beliefs concerning future events. Forward looking statements are necessarily subject to risks, uncertainties and other factors, many of which are outside the control of Salt Lake Potash Limited, which could cause actual results to differ materially from such statements. Salt Lake Potash Limited makes no undertaking to subsequently update or revise the forward-looking statements made in this announcement, to reflect the circumstances or events after the date of that announcement.
APPENDIX 1 – BRINE CHEMISTRY ANALYSIS
APPENDIX 2 – JORC TABLE ONE
Section 1: Sampling Techniques and Data
For further information please visit www.saltlakepotash.com.au or contact:
Matt Syme/Sam Cordin
|Salt Lake Potash Limited||Tel: +61 8 9322 6322|
Salt Lake Potash Limited
|Tel: +44 (0) 20 7478 3900|
|Colin Aaronson/Richard Tonthat||
Grant Thornton UK LLP (Nominated Adviser)
|Tel: +44 (0) 20 7383 5100|
|Derrick Lee/Beth McKiernan||
Cenkos Securities plc (Joint Broker)
Tel: +44 (0) 131 220 6939
|Jerry Keen/Toby Gibbs
|Shore Capital (Joint broker)||
Tel: +44 (0) 20 7468 7967
The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.