Highfield Resources (ASX:HFR) has announced it has intersected 4.5 meters of potash at a depth of just 282 meters at its Javier project, in Northern Spain. Highfield is basing its exploration program on historical exploration work in the 80s which included ten drill holes. The company is currently advancing the Javier project and plans to release a pre-feasibility study quite soon, but we doubt this study will show the project to be viable at the current MOP price of $280/t, but we are curious to see the economics of this project using a longer term price assumption of $400/t.
We are strong believers in the Spanish mining sector, and a potash project might be a nice diversification from gold and copper which currently are the two main commodities being mined in the country.
Disclosure: The author holds no position in Highfield Resources. Please see our disclaimer for current positions.