Name of the Project
Lake Wells sulphate of potash (SoP) project.

Location
The project is located 500 km north-east of Kalgoorlie, in Western Australia.

Client
Australian Potash Limited (APC).

Project Description
A scoping study has confirmed that the project’s economic, financial and technical aspects are all exceptionally strong, and highlights APC’s potential to become a significant long-life, low-capital and high-margin SoP producer.

The proposed project will be developed in two stages, enabling it to mitigate operational and commodity price risks before committing to Stage 2 capital expenditure.

The staged development approach enables APC to optimise
economic outcomes based on future market dynamics while providing the company with the flexibility to capture domestic Australian SoP demand early.

The Stage 1 development comprises a 150 000 t/y SoP processing plant, 35 bore brine abstraction networks, evaporation ponds, an accommodation village and associated site infrastructure.

The Stage 2 development duplicates the processing plant, expanding its capacity to 300 000 t/y of SoP, and increases the span of the bore field and the area of the evaporation ponds.

The project brine is naturally high in sulphates, which enables APC to increase SoP production using the same pumped brine volume.

The processing plant has been scoped to include the muriate of potash (MoP) to SoP conversion circuit, with Stage 2 duplicating Stage 1.

At 150 000 t/y of SoP output, 50 000 t/y will be SoP that has been converted from MoP.

At 300 000 t/y SoP output, 100 000 t/y will be SoP that has been converted from MoP.

The project has a mineral resource of 14.7-million tonnes of SoP, including 12.7-million tonnes in the indicated category.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has a net present value, at a 10% discount rate, of A$500-million and an internal rate of return of 33%, with a payback of 2.9 years for Stage 1 and 1.7 years for Stage 2.

Value
Preproduction capital based on an initial 150 000 t/y SoP plant has been estimated at A$175-million, including contingency of A$24.4-million.

Stage 2 expansion capital, which is planned for Year 5 of operations, has been estimated at A$162.9-million.

Duration
Not stated.

Latest Developments
The permitting and approvals process for the Lake Wells SoP project is well advanced, with final Ministerial approval expected in the second half of this year.

The project will be assessed on the “second-least stringent level of assessment”, which is an environmental review without public comment. This level of assessment will require APC to submit sufficient information so that the Environmental Protection Association (EPA) can understand how the project will be developed and what impacts the development will have on the surrounding environment.

The Lake Wells SoP development area does not have any native title claims and the mining leases applied for in 2016 have been recommended for grant.

The company has licences in place to build bores and abstract water, permits to build and operate evaporation ponds, and an approved project management plan.

“We will continue to work with the EPA to complete the assessment process in parallel with assessment by the Department of Mines, Industry Regulation and Safety of a mining proposal and mine closure plan . . . to finalise all approvals for the project,” executive chairperson Matt Shackleton has said.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
APC executive chairperson Matt Shackleton, tel +61 438 319 841 or email m.shackleton@australianpotash.com.au.