Oct 212011

By Teri Walker–

Passport Potash Inc. has announced that it won’t be releasing its report analyzing potash mining exploration findings until the end of October, and even then, the report will not include estimates of how much potash could be extracted from the company’s holdings. That information won’t be available for another two months.

Passport officials initially said they expected to release the resource report, titled an NI (National Instrument) 43-101, in early September.

The delay, said Ken Bond of Passport’s Corporate Development Division, is because the company preparing the report on behalf of Passport has said while it will accept the findings conducted through Passport’s own drilling exploration of the past two years, it requires a third-party verification of historic data about how much potash is actually present in the Holbrook Basin.

The time required to conduct the third-party verification is what will take an additional two months.

Bond explained that the initial approach with the NI 43-101 had been for the company to drill exploration wells on its land holdings to “prove up” existing data about the basin’s underlying potash deposits. It was hoped that if the findings from present-day explorations were similar to those recorded in historic exploration of the deposits, it would be acceptable to then infer the historic data about how much and what thickness of potash is in the Holbrook Basin is accurate.

Passport has been told by SRK Consulting, Inc., the engineering firm preparing the report, that its “if A equals B, then C” assumption isn’t acceptable, which is why the third-party analysis of the historic data is required.

The historic exploration of the Holbrook Basin concluded there is 0.7 billion to 2.5 billion tons of potash, a mineral used primarily in fertilizer production.

Bond said, “We want to be able to identify what the exploration potential is in the basin, and what our portion of that total would be.”

Passport does not need to drill additional exploration wells to conduct the analysis; rather, analysts will review the existing data related to the historic exploration.

Passport Potash currently controls more than 70,000 acres in the Holbrook Basin; the company’s holdings are poised to increase if its pending purchase of the 41,000-acre Fitzgerald Ranch is finalized.

American West Potash, which has also been exploring in the Holbrook Basin, expected to release its NI 43-101 report this week.

HNZ Potash, the third company exploring the Holbrook Basin, has not announced the timing of its resource report, although the company has said it has completed its exploration drilling and analysis of findings is underway.