VANCOUVER (miningweekly.com) – The Mexican Superior Court issued a unanimous ruling this week in favour of Nasdaq-listed Odyssey Marine Exploration’s subsidiary Exploraciones Oceánicas (ExO), which overturned a previous denial of ExO’s environmental permit application to extract phosphate sand at its Don Diego project, in the Bay of Ulloa.
Over the last 20 years, Odyssey has pioneered the exploration and development of seabed mineral resource deposits, integrating and developing ocean technology.
The company’s now fully permitted Don Diego project contains high-grade phosphate sands within Mexico’s Exclusive Economic Zone, beyond its territorial waters. Odyssey believes the discovery will bring important benefits for the country’s agricultural development.
The deposit lies within a mining concession licensed to ExO, a subsidiary of Oceanica Resources, in which Odyssey holds a 53.88% interest.
The current resource assessment defines the deposit as containing 588.3-million tonnes of phosphate ore grading 18.1% phosphorus pentoxide, held under 1.14 m of overburden and with an ore thickness of 2.8 m.
Odyssey reported the ruling in a filing with the US Securities Exchange Commission on Thursday, sending its Nasdaq-quoted equity jumping 230% from $3.80 to an intra-day peak of $13.75, before closing at $8.30, with more than 2.2-million shares traded. The stock added another 13% on Friday to close at $9.20 a share.
The development represents a significant step forward for other prospective marine miners in Mexico, with TSX-V- and NZAX-listed Chatham Rock Phosphate welcoming the ruling because it establishes a precedent for the consenting of marine phosphate mining.
Chatham has several links to the Don Diego project, including a number of Chatham's US-based shareholders, who have also invested in both Odyssey and directly in the Don Diego project. The firms also share a common director.
Chatham has conducted agricultural tests of the Don Diego rock phosphate in New Zealand, which show the Mexican rock phosphate is both relatively high-grade in its natural form without being beneficiated, and is also an effective reactive phosphate rock.
"This is the best news for Chatham since we were granted our mining permit back in December 2013, as it establishes a precedent for marine phosphate mining after extensive and detailed environmental assessment,” Chatham president and CEO Chris Castle commented.
The Don Diego approval also follows the granting of an environmental consent to Trans Tasman Resources in New Zealand's territorial waters last year and evidences the reality that marine mining, if managed carefully and responsibly, can be carried out with minimal impacts on the marine environment, Chatham stated.