"Potash is commercially mined through two methods, conventional underground mining and solution mining techniques. The geology of the deposit dictates what method is best suited for resource extraction.
Conventional mining methods have a depth limitation, once potash reserves are deeper than 1200 meters, solution mining must be employed. For the most part, the solution method of mining is due to the fact that potash is found in sedimentary rocks. Sedentary rocks tend to collapse when they are dug too deep, and deep mine shafts are also prone to flooding due to the porosity of these rocks.
Solution mining offers a few advantages compared to conventional underground mining including lower up-front capital cost and a shorter ramp-up time. As all mining methods, the profitability of a solution mine is affected by the mineralogy, grade and tonnage of the potash reserve.
Solution mining costs are directly related to drilling cost and the quantity of potash produced from each well. A variety of production well configurations for solution mining are available dependent upon the geology of the deposit. Most solution mining has involved extracting potash-bearing solutions from flooded underground mines or used well designs which access the potash with vertical drill holes. Improvements in drilling techniques, particularly the ability to drill horizontally have enabled the cost effective extract ion of a variety of deposits, including those with thinner potash beds."
"The beds identified are flat lying, usually less than a 2 degree dip. This feature is important for productive solution mines as stratigraphy that has dipping beds of greater than approximately 5 degree will encounter a greater dilution from adjoining salt beds, creating a lower overall grade. It also causes engineering problems with the underground solution being extracted."
--------------
"Why is the EV so low?" "A million dollar" question need "a million dollar" answer and if I knew exactly the answer I could be come a millionaire :). I think the market needs to know the real numbers of the deposit.
And this might be one of the answers: " Our estimated resource for Transit from initial 4 holes: 100mt - 200mt at 32% KCl We believe that the initial 4 hole drilling campaign, if successful, has the potential to outline an initial resource of 100 - 200mt at 32% KCl (32 - 64mt of contained KCl). This would result in a significant re-rating of the stock price given the recent experience of the listed peer group, shown Transit appears undervalued when compared with other potash companies in Table 2. This estimated resource potential is based only over state leased blocks. Transit cannot report a JORC compliant resource which lies over Federal ground. Therefore, a thorough resource statement, that encompasses both State and Federal grounds, can only be generated once Federal ground is permitted by the BLM."
TRH Price at posting:
83.0¢ Sentiment: LT Buy Disclosure: Held
