Canada’s Manitoba to open bids for major potash deposit
After years of exploring around the Russell-McAuley potash deposit, a mineral formation located in Canada’s Manitoba's western part, the province is set to invite world’s producers to come develop a mine.
Manitoba Potash Corp., the Crown corporation who owns the rights to the deposit located near the Saskatchewan border, says the potential mine could generate $2 billion worth of royalties for the province over the course of 40 years, and sustain close to 600 jobs.
The stumbling block for this to happen, Manitoba's Minister of Mineral Resources Dave Chomiak hinted in an interview with CBC News, is the fact that it would take at least seven years to develop such mine, and the invitation letters are being issued at a time when potash prices are at a six-year low.
Current market conditions are not optimal for new players. The already oversupplied sector has seen several other major developments, the biggest being BHP Billiton’s (ASX:BHP) Jansen mine with its 5.3bn tonnes of measured resources and 1.3bn tonnes of inferred potash, going back to the drawing board.
It is estimated that the Russell-McAuley contains more than one billion tonnes of potash, located 800 metres to one kilometre below ground in the 2,247-square-kilometre area. According to Manitoba, the quality and mining conditions of the deposit is comparable to those Saskatchewan, the world’s largest producer of the fertilizer ingredient.
Image by Tyler Olson|Shutterstock.com