JOHANNESBURG (miningweekly.com) – A scoping study on TSX-listed Western Potash’s 100%-owned Milestone property, in southern Saskatchewan, has projected a significantly reduced risk profile and allowed for the staged development of the project.

TSX-listed Western Potash president and CEO Pat Varas pointed out in a statement on Thursday that in the current pricing environment, it had been “very difficult” to find solutions to finance and move Milestone forward.

But, he noted that in taking a step back and rescoping its Milestone property for a pilot-plant-scale selective solution mining operation, the company was greatly encouraged by the results.

The study was a preliminary economic assessment prepared by Novopro Projects in conjunction with Agapito Associates, of Milestone.

It outlined how Western Potash could effectively exploit the Milestone asset through reduced targeted levels of potential production, using selective potash solution mining techniques, while projecting a reduced capital expenditure (capex) and competitive operational expenditure (opex).

The pilot study also included a resource estimate for the study area.

Western Potash advised that the study reported the resulting after-tax/royalty projected net present value for the project to be C$56.7-million, with an internal rate of return of 25.2 %, assuming a nominal discount rate of 10%, capex of C$80.6-million, opex of C$80/t and a potash price of $315/t free on board Vancouver.

“The anticipated lower capex requirements, alternative potential production scenario and improvement in projected economics will potentially facilitate a fresh look at investment in the company by a much larger project financing and investment pool. With this new platform, management is looking forward to renewed interest by the investment community to fund the initial development of Milestone," Varas added.