Potash West Reports 108% Increase in Indicated Resource for Dinner Hill

Potash West (OTC:PWNNY,ASX:PWN) announced a 108% increase in tonnage at its Dinner Hill Project in Perth, within the company’s Dandaragan Trough Project area: 250Mt at 2.9% P2O5 in the indicated category (within this phosphate resource there is an indicated mineral resource of 155Mt at 4.1% K2O (potassium oxide)), and 20Mt at 2% K2O in the inferred category. An additional Indicated Mineral Resource of 18Mt at 3.8% K2O occurs marginal to the phosphate resource. Resource expansion potential remains open to the east and the south. This phosphate resource has an increase in grade to the north within the area of the new drilling, reflecting an increase in tonnes and grade compared with the phosphate resource estimate published in 2014.

Highlights:

• Indicated phosphate resource of 250Mt at 2.9% P2O5
  • Tonnage increase of 108%
  • Grade increase of 4%
• Higher phosphate grades identified in the north of the deposit to underpin planned feasibility study
• Indicated and Inferred potash resources to 195Mt at 3.8% K2O (potassium oxide)
• Target Molecap Greensand now estimated to contain 175Mt at 4.0% K2O
  • Tonnage increase of 43%
  • Grade decrease of 12%
• Resource expansion potential remains open to the east and the south

As quoted in the press release:

The Dinner Hill Deposit has, above a cut-off grade of 1.45% P2O5 (phosphate), an Indicated Mineral Resource of 250Mt at 2.9% P2O5. Within this phosphate resource there is an Indicated Mineral Resource of 155Mt at 4.1% K2O (potassium oxide) and an Inferred Mineral Resource of 20Mt at 2% K2O. An additional Indicated Mineral Resource of 18Mt at 3.8% K2O occurs marginal to the phosphate resource.

The resource update uses drilling carried out in 2014 and 2015 comprising an additional 90 aircore drill holes for 2732m. The recent drilling extended the north-south length of the resources from 4000m to 7200m and the east-west width in the central portion of the deposit from approximately 2700m to 3700m.

Significantly, the phosphate resource increases in grade to the north within the area of the new drilling, which reflects an encouraging increase in tonnes and grade compared with the phosphate resource estimate published in 2014, (ASX release 20 March 2014). These results will form the basis of pit design and mine scheduling studies carried out as part of the planned feasibility study into phosphate production at Dinner Hill, set to begin in the third quarter of 2015.

The principal potash mineralisation occurs within the Molecap Greensand – which is now estimated to contain 175Mt at 4.0% K2O, a 43% increase in tonnes and a 12% grade reduction compared to the original estimate published in October 2012, (ASX release 11 October 2012). Potash grades decrease in the north of the Dinner Hill Deposit, resulting in the marginal decrease in the average grade.

Potash West Managing Director, Patrick McManus, said:

These are very pleasing results, which have further highlighted the world class size and prospectivity of our Dandaragan Trough Project. This drill program had several objectives:

• To identify the extent of mineralisation, to allow a definition of the deposit sufficient to delineate an area that will be affected by mining, for permitting purposes;
• To obtain samples to complete metallurgical and process development testwork, sufficient for feasibility studies; and
• To drill a sample area of the deposit to confirm the drill density that will be required to report a JORC resource to a Measured Resource category.

These were all achieved. Importantly, the mineral inventory for phosphate production has increased substantially, and there is still a significant area of the prospective Dinner Hill tenement to be explored. Phosphate and potash mineralisation are open to the east and to the south, as shown in Figures 4 and 5, which offers considerable upside at Dinner Hill for increased project life, or capacity increases.

We look forward to incorporating these new findings into the scoping study for Dinner Hill.

Click here to read the Potash West (OTC:PWNNY,ASX:PWN) press release
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