Sage Potash (SAGE.V) has released its anticipated resource update on the Sage Plain Potash project. In our recent coverage, we explained how we expected the successful completion of the Peterson 1 well to result in both a resource increase as well as an upgrade.
And Sage Potash didn’t disappoint. The total resources now stand at in excess of 770 million tonnes across all resource categories, of which 226 million tonnes are part of the measured and indicated resource categories. The grade is also very consistent with an average grade of 41.3-41.5% KCl across all three categories, as you can see below.
The measured resource is based on the radius of influence of 0-750 meters while the indicated resource is based on 750-2000 meters indicating (pardon the pun) a pretty tight control on the M&I resource base.
Keep in mind this resource is based on just two holes, and the consistency of the mineralization as well as the excellent resource grade are now confirming the Sage Plain Potash project as one of the most important potash resources in the United States.
We are looking forward to seeing the full technical report on the resource update (where after we can discuss it into more detail and catch up with Sage’s management team), but it is clear the company will hit the ground running. The next steps at Sage Plain will include additional engineering focusing on solution mining and determining the optimal mining and plant throughput capacity, and related to that, continue the environmental study work for the new design.
All elements will subsequently be used to put together a pre-feasibility study to determine the updated economics of the project. As mentioned before, Sage Potash’s management team is guiding for a substantial increase in the production rate from the 300,000 tonnes per year used in the 2025 Preliminary Economic Assessment. The stars are aligning for Sage Potash, and the updated resource confirms the project could play an important role in the US domestic supply chain. It’s now up to the technical team and the independent consultants to work on a pre-feasibility
Disclosure: The author has a long position in Sage Potash. Sage is a sponsor of the website. This post is for educational purposes only; be mindful investing in junior mining stocks is risky and you may lose your entire investment if things go wrong. Please read the disclaimer.
