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Feb 242012
 

By Linda Kor –

It was approximately four years ago that the Arizona Geological Survey brought to light the potential of a vast reserve of potash within the Holbrook Basin. Since that time three companies have set up camp in the basin, and are at various stages of resource and economic analysis. With the rising demand for potash in countries such as China and India, these operations show every indication that Holbrook and the surrounding communities may be in line to experience an economic boon in the near future.

To bring it into perspective, an economic comparison could be drawn to the community of Safford, which experienced an economic boon in 2006 when Phelps Dodge came to the area and opened a copper mine.

At that time Safford was a community of approximately 9,000 residents with an average household income of less than $25,000. With the development of the Phelps Dodge mine came 500 construction jobs and that number doubled six months later. As a result of this influx, new retail industry came to town, as well as other amenities that added improvements to the community. Since that time the population has increased by approximately 1,000 residents and the average household income has increased to $53,370.

While Safford’s copper mine has hit some highs and lows, potash mining has every indication of remaining in high demand due to the increasing need for the mineral as an ingredient in fertilizer for agriculture and a limited supply. Though the U.S. is the world’s largest crop producer, it historically has mined little potash, instead relying on mines in Canada.

A recent resource estimate released by one of the mining operations in the basin, Prospect Global Resources (American West Potash), indicates that at least two million finished tons of potash can be extracted annually, with the potential of 2.5 million tons to three million tons for the next 40 years for that operation alone. If each of the three mining companies goes into full production with estimates similar to Prospect Global Resources’, then the basin has the potential to be a real player in the global potash market.

What makes the basin especially appealing to Prospect Global Resources, as well as Passport Potash and HNZ Potash, the two other mining operations in the basin, is the close proximity to existing infrastructure for transport to the Port of Long Beach in California via railway and interstate connections to areas throughout the nation. In a majority of mining operations, the companies must create their own infrastructure in order to get their product to market.

Even with the knowledge of the potential influx of more residents, tax dollars and retail business, preparing for such a possibility has its limitations. Today’s economy has made housing developers cautious and cities weary of budget cuts being handed down from every level of government. The result is a wary eye at investments in growth, and possibilities for expansion are carefully considered.

As part of the effort for preparedness, local organizations for economic development such as Holbrook Business Development Group (HBDG) and RealAZ Corridor have formed to provide planning, public awareness and research opportunities for ancillary industries. In addition, Northland Pioneer College will be coordinating with the mining companies to provide courses teaching the skills required for their operations. City governments in the area have indicated their support of the mining operations with an eye toward job creation and economic development.

As the Phelps Dodge mining operations began in the community of Safford, residents felt unprepared for the influx of new residents, which produced a housing shortage, traffic congestion and increased housing costs. Whether the community of Holbrook and the surrounding areas are going to be prepared will be determined by the involvement of their residents and the vision of their community leaders.

Area residents are invited to take part in a community forum hosted by HBDG at 6 p.m. on Wednesday, Feb. 29, at the George Gardner Performing Arts Center on the Holbrook High School campus. This forum will feature Passport Potash CEO Joshua Bleak and Prospect Global Resource CEO Pat Avery as speakers, with geologist Lee Allison of the Arizona Geological Survey also participating. The public is encouraged to participate with questions for the speakers regarding their respective operations.

 

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