TORONTO (miningweekly.com) – Vancouver-based Encanto Potash on Tuesday said it had completed a $2.7-million private placement, which saw a director of the company partaking in a significant portion of the offer.
Hamad Al-Wazzan bought 7.35-million of the 7.95-million new shares issued and sold, at 34c a piece, which brought his total investment in the company to $10-million. He previously participated by buying $7.5-million in Encanto convertible debentures in January.
The company said it intended to use the proceeds of the offering to ensure the feasibility study on the Muskowekwan First Nation property and the associated infrastructure and logistics studies were funded to remain on track for completion late in the year.
In March, the Canadian federal government and the Muskowekwan First Nation announced the Muskowekwan First Nation potash project had been accepted by the federal government under the First Nations Commercial and Industrial Development Act, which enables the federal government to enact a provincial regulatory regime to govern commercial and industrial activities within a First Nation reserve.
First Potash Ventures, a partnership between Encanto Potash and Muskowekwan Resources, was working toward developing the mine on the First Nation’s reserve, located 100 km north-east of Regina. The mine was expected to produce up to 2.8-million tons of potash a year over a 50-year-plus lifetime.
The project is expected to provide economic opportunities for the Muskowekwan First Nation, as well as the surrounding area, by providing training and employment opportunities during the construction and operation of the mine.