It’s like coal-mining,” BHP Billiton CEO Marius Kloppers says of potash-mining.

Demand for potash has surged, driving prices into orbit, after the market spent the last three decades in surplus, with the last new mine being built more than 20 years ago.

Kloppers says that, just like coal-mining, a continuous miner is installed and basic board-and-pillar mining undertaken.

“You convey it out, you dissolve it, you recrystallise it, and that’s the product,” says Kloppers of potash-mining, into which the BHP Billiton that he leads might be investing “billions and billions of dollars” in the future.

The world’s largest diversified mining company already has a $200-million-plus potash programme under way, $100-million of which will be invested in the next 12 months, primarily to drill 23 new holes in newly acquired Anglo Potash, which gives it access to 7 338 km2 of highly prospective exploration permits in the immediate vicinity of existing major potash mines in Saskatchewan, Canada, domicile of the world’s biggest potash mines, although some excellent potential is unfolding in Africa’s Congo.

In drilling the 23 holes, BHP Billiton’s specialised products division will be twinning with 300 government holes already sunk, to ensure reliable use of data.

Thereafter, it will start planning in the same manner as one would a coal-mine, mining by a vertical shaft system sunk 500 m below the ground – a veritable Khutala lookalike, Kloppers says in reference to BHP Billiton’s coal mine in South Africa’s Mpumalanga coal province.

Kloppers tells Mining Weekly that he is “very excited” by potash, the price of which has been soaring as a result of the population of industrialising countries like China becoming richer.

“As people become richer and industrialise, they tend to have a higher level of diet,” Kloppers says, which means, basically, that they eat more meat. This requires more cereals to be planted for animal feed, which creates demand for more potash fertiliser.

Kloppers sees the same “industrialisation effect” that has boosted BHP Billiton’s other products creating the same economic environment for potash.

“We’ll give an update in a couple of months’ time on the progress of the potash project,” Kloppers promises.

Ninety-five per cent of world potash production is used in fertiliser, with Saskatchewan responsible for a quarter of global potash output.

Fertiliser giant Potash Corpora- tion of Saskatchewan recently reported second-quarter earnings of $905,1-million, its highest ever and more than triple the profit of $285,7-million posted in the corresponding period a year ago.

Potash Corp CEO Bill Doyle says that the looming global food crisis has prompted farmers the world over to strive for optimum yields, which is placing a priority on fertilisation.

BHP Billiton’s diversified rival, Rio Tinto, also has its eye on the growing potash market, and hopes to start producing the crop nutrient from its first mine in 2012, energy and minerals CE Preston Chiaro says, from assets in Argentina and Canada.

“We think this is a market that will grow in importance in the future, not only as developing countries improve their food supply, but also potentially from biofuels,” Chiaro says.

Rio Tinto bought PRC in 2002, has a pilot plant and may enter the fray in the next four years at an investment of $3,5-billion.

The group has staked about 1 200 km2 of prospective property in Saskatchewan, where it is also drilling.

South African contractor Shaft Sinkers has won a contract to sink a shaft into one of the world’s largest potash deposits, at the Gremyachinskoye mine at Kotel’nikovo, 100 km from the Volgagrad region in Russia.

source : Mining Weekly Online

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