Resource World Magazine

36 www.resourceworld.com o c t o b e r / n o v e m b e r 2 0 1 5 to Saskatchewan Economy Minister Bill Boyd, "We have one of the most opportu- nity-rich investment climates in the world and nowhere is this more evident than in our mining industry." PoTaSH Saskatchewan is a potash powerhouse, accounting for one-third of global pro- duction, and in 2014, off-shore sales of potash set a provincial record of 18.4 million tonnes. The province's potash pro- ducers are undeterred by the short-term potash market fluctuations, and forged ahead with upgrades and expansions at a collective cost of nearly $14 billion to increase the productive capacity by 90% by 2023. Canpotex Ltd., the overseas selling agency for Saskatchewan's producers, is also investing $140 million to expand the potash export facility at the Port of Portland's marine Terminal in Oregon. In addition to Saskatchewan's 10 producing mines, K+S Potash Canada GP is construct- ing the province's first new potash mine in over 40 years at the Legacy solution mine site about 60 km northwest of Regina. Potash exploration and development continues with explorers advancing a number of projects from greenfields to advanced-stage exploration. BHP Billiton Ltd. has committed up to $3.8 billion in expenditures on the Jansen potash project. Expenditures on potash exploration and development projects in 2013 was $71 mil- lion, with R&D expenditures for projects in 2014-15 estimated to exceed $88 million. Potash Corporation of Saskatchewan [POT-TSX] operates five potash mines in Saskatchewan which produce one-fifth of the global capacity. Investor concerns about slowing demand have driven shares of Potash Corp. down almost 27%, to $25.50 in the past year, but analysts expect results to stabilize this year and begin to rebound in 2016. Earnings per share are set to rise from an estimated $1.81 in 2015 to $2.02 in 2016. The company has spent almost $8 billion expanding its mines to increase production. The Mosaic Company [MOS-NYSE] produces phosphate and potash crop nutrients and operates the Belle Plaine, Esterhazy and Colonsay potash mines. During the second quarter 2015 Potash sales totaled $730 million, down from $762 million in 2014. Mosaic anticipates strong global demand for potash during the remainder of the year. Agrium Inc. [AGU-TSX] operates the Vanscoy potash mine and is currently ramping up production to 1 million tonnes over next two and a half years. Agrium expects to achieve annual diluted earn- ings per share of $7.00 to $7.50 in 2015, compared to our previous estimate of $0 to $8.25 per share. Western Potash Corp. [WPX-TSX] announced a financing in July with Beijing Tairui Innovation Capital Management which invested $80,000,000, giving Tairui a 51% ownership stake in Western Potash. At the same time, CBC (Canada) Holding Corp. also purchased $720,245.67 of equity which will result in CBCHC holding a 10.1% ownership stake in the company. Funds will be used to complete engineer- ing studies and begin moving forward with a pilot plant at the Milestone Project. Encanto Potash Corp. [EPO-TSXV] has a 100% interest in the Muskowekwan potash project which hosts 162.0 million tonnes of proven and probable reserves, an indicated resource of 31.3 million tonnes and an inferred resource of 158.7 million tonnes. The company is exploring domes- tic and international partnerships for financing, development and sale of potash production from its MFN JV property. uraniuM Saskatchewan is the second most prolific producer of uranium in the world, yield- ing 24.2 million pounds, representing a 15.6% share of primary global supply. The bulk of the production comes from the McArthur River–Key Lake operation, which generated 20.1 million pounds. The balance was produced from the Eagle Point Mine at Rabbit Lake. Mining and production from the Cigar Lake Mine and the McClean Lake mill started in late 2014 and it is anticipated that the operation will produce 0.2 to 0.6 million lbs/year. Nearly $140 M was spent on ura- nium exploration in 2014, with a slight decrease to about $132 M expected in 2015. Activity has been bolstered over the last two years by ongoing exploration successes, primarily in the Patterson Lake South area flanking the southwest margin of the Athabasca Basin. Cameco Corp. [CCO-TSX; CCJ-NYSE] is the largest uranium producer in Saskatchewan and holds a 69.8% stake in McArthur River, and a 50% stake in Cigar Lake – the world's second largest high- grade uranium deposit. On the exploration front, Cameco has a 39.5% interest in the Hook Lake Project. Hook Lake consists of nine claims and has three prospective corridors. Current exploration is focused on the Patterson Lake corridor, a conduc- tive trend that also hosts Fission's Triple R deposit. CanAlaska uranium Ltd. [CVV-TSXV] has optioned a 50% interest in its West Patterson property to Makena Resources Inc. [MKN-TSXV] who has identified a large gravity target. Makena is raising funds to drill the target which is adjacent to the Fission Uranium Patterson Lake dis- covery. CanAlaska also holds interests in the Cree East and West McArthur projects. All projects are in the Athabasca Basin. Denison Mines Corp. [DML-TSX] con- tinues to explore the Phoenix uranium deposit on the Wheeler River property and most recently completed 12 drill holes, eight of which were at the Gryphon Zone. The best result intersected 3.8% eU 3 O 8 over 4.7 metres, followed by 8.4% eU 3 O 8 over 1.1 metres which extended mineral- ization in the down-dip direction. Drilling is expected to continue with three drills until late August at Wheeler River on sev- eral target areas, all of which are in the vicinity of the Gryphon Zone. Fission uranium Corp. [FCU-TSX] released results of a NI 43-101-compliant PEA for the uranium resource on the Triple R uranium deposit, at its 100%-owned PLS property in the Athabasca Basin. Post- tax IRR is 34.2% and payback is estimated at 1.7 years post-tax. Estimated initial capital costs are $1.1 billion with average

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