Resource World Magazine

36 www.resourceworld.com F E B R U A R Y / M A R C H 2 0 1 4 MINING IC Potash Corp.'s [ICP-TSX, ICPTF-OTCQX] advancement of its sul- phate of potash (SOP) project in southeast Mexico achieved a major milestone with the announcement of the positive results of an inde- pendent feasibility study on its 100%-owned Ochoa Project. Once in production, the project will be a primary producer of SOP; the highly advanced polyhalite mineral deposit contains proven and probable reserves of more than 400 million tons of ore within the proposed mine plan. Sidney Himmel, President and CEO of IC Potash, stated in the January 23 announcement, "This feasibility study evaluated all aspects of our plan to produce SOP from our polyhalite mineral reserves. We are pleased with the technical validation of the mining and processing design, and the resulting economic characteristics. The Ochoa Project positions ICP to become a world leader in SOP pro - duction and a bottom quartile cost SOP producer. We intend to begin immediately with the next phases of engineering and financing." The Ochoa Project's accessible, high-grade deposit has sub-hori- zontal and conformable bedding, and consistent mineral and chemical compositions throughout which makes for cost-effective production. The company stated that the 18,747 feet drilled during Phase 3, "con- firmed the thickness and grades of polyhalite and substantiated the Ochoa Project's ore as accessible." Resource assessment work for the Ochoa Project began in 2009, and was completed in March 2013. Work included a project mapping database using data from more than 950 petroleum drill holes and 32 ICP drill holes drilled from four drill programs. The resource assess - ment program defined the deposit as a single polyhalite bed located at a depth between 1,500 and 1,600 feet below surface in the area of the Ochoa mine plan. The polyhalite bed is between 4 feet and 6.5 feet thick and is a single bed without interburden. Mineralization is laterally continuous and consistent mineral compositions dominated by polyhalite (80% undiluted) with minor amounts of anhydrite, halite, and magnesite. No faulting or folding has been detected, and the resource tapers to zero thickness in a narrow zone at the periph - ery of the mineralized area. Initial pilot plant testing in connection with the processing of polyhalite ore into SOP demonstrated the "robust nature of the flow sheet and economic conversion of polyhalite to SOP." The results were incorporated into the study with respect to final equipment selection and sizing and the computation of projected capital costs and operat- ing costs. The Ochoa Project's mine plan calls for an underground mine that will utilize room and pillar mining methods common to the area's Carlsbad Potash Mining District and will use state-of-the-art, high- horsepower, continuous mining equipment. Linear cutting tests indicate drum-type continuous miners would be most efficient. The Ochoa polyhalite ore bed will be accessed via an inclined ramp and vertical shaft. Ore will be delivered to a coarse storage bin, ahead of the plant, via a conveyer exiting the mine portal with a 4,000 ton per hour capacity. After processing, the finished SOP product will be trucked 22 miles to a rail loading and truck distribution facility that provides access to domestic rail, truck markets, and international dry bulk port facilities. IC Potash estimates that the Ochoa Project's annual throughput to average approximately 3.25 million tons per year over its first phase of 40 years. Before taxes and in US dollars, the study calculates capital costs on a full equity basis (no debt) to be $1,018 million which includes $107 million for mine infrastructure and development, $527 million for the processing plant and contingency costs of $112 million. The study outlines a per ton operating cost of $195.00, an 8% discounted NPV of $1,502.30 million, and projects an internal rate of return of 17.8%, with a payback period of 5.4 years. Construction and commissioning will take approximately three years to complete and will begin in Q2 2014 with full capacity expected to be achieved in 2018. IC Potash expects to receive a Record of Decision on its Environmental Impact Statement in early April 2014. Technical review for an air quality permit by the Mexico Environment Department Air Quality Bureau is expected to be completed by June 10, 2014. n IC Potash – Ochoa Project mine construction planned for 2014 By Kathrine Moore Drilling at IC Potash's sulphate of potash Ochoa Project in southeast Mexico. Photo courtesy of IC Potash.

• Cover