background

Gold Dragon Resources Projects

Projects

PDI Llamara Heap Leach Project

This project targets the Salar de Llamara water-soluble solid resources for strip mining and ore transport to heap leach pads, followed by solar evaporation of the leach solution. The harvested salts will then be processed for sale. PDI’s corporate strategy will be to start with the Llamara Heap Leach Project. The project was chosen as it has robust margins, a relatively low capital cost and low engineering and permitting risk given its similarity to many other heap leach operations in the area.

Project Highlights
  • Simple and commonplace heap leaching and solar evaporation process planned
  • Significant market premiums paid for SPN (defined below) fertilizer products
  • An extensive near surface layer of soluble sulphate rich evaporite minerals
  • Newly discovered Hilaricos aquifer water or sea water to be used for heap leaching
  • High solar evaporation rates reduces production unit costs
  • Low capital cost, and bulk export terminal access and unit cost agreed

The water-soluble sulphate evaporite minerals that occur on, or near, the surface of the project area are minerals such as kainite, syngenite, leonite, polyhalite, glauberite, blodite and thenardite.

SPN products command a significant premium over potassium chloride or Muriate of Potash (MOP). The SOP premium is due largely to the process costs involved in converting MOP to SOP, which process accounts for 85% of world SOP supply. The conversion cost, combined with the scarcity of primary SOP production buoyed by the demand for application to premium crops has contributed to a price premium of SOP over MOP averaging approximately 50% for the past decade. The SOP/MOP premium increased significantly in the latter part of 2013 to 98% as demonstrated by Compass Minerals’ Q3/13 realized price of $712/ton for SOP and Potash Corp’s Q3/13 realized price $360/ton for MOP. PDI’s long term price assumption modelled for SOP is $585/t.

 

 

 

 

GDRMI Isabel, Cote and Lomas de la Sal Rock Salt Project

This project will mine rock salt from three locations on and near the Salar Grande. The rock salt will be crushed and screened and then transported to a marine terminal by road. The rock salt products will be shipped to the market in bulk dry cargo ships via a yet to be permitted and constructed private marine terminal, commencing with initial bulk shipments via the public port of Iquique. The Isabel project has received the permits necessary to start mining and exporting bulk salt via the public port of Iquique. Upgrading of the San Marco pass in the west, and cheaper above-surface mining cost, with the use of “road trains” across the near flat salar, the vast Lomas de La Sal resource becomes significantly economic.

The 45 km long Salar Grande basin is host to a near pure halite deposit that is reported to be greater than 100 m thick in places. The halite sequences, which also outcrop in the Pampa del Tamarugal, 50 km to the SE in the Lomas de la Sal area, show physical continuity with the saline deposits of the Salar Grande basin. The halite deposits of the Salar Grande are currently being mined at a rate of more than 8 Mt per year for the de-icing and industrial chemical market by Sociedad Punta de Lobos and Compañía Minera Cordillera for export to the North American and European markets. GDR’s 52 % owned subsidiary (Potash Dragon SpA) holds exploration rights over 2,428 hectares of the halite outcrop at Lomas de la Sal, which is estimated to be 72 m thick. The Lomas de la Sal halite deposits have been mined for rock salt in the past.

Project Highlights
  • The Isabel mine is permitted to commence mining, transport and export salt
  • Simple mining, crushing and screening process
  • Close to existing producers
  • Low cost, high margins and anticipated robust returns
  • Cost estimates are based on a start up with contractor operated and supplied equipment, transitioning to owner operated over time

Precedent Chilean Rock Salt Transactions
  • Sal Lobos. In 2006 K+S bought Sociedad Punta de Lobos for $480m, which had revenues of $350m and earnings of $48m in 2006, a capacity of 6 million tonnes per year and extensive reserves on the Salar Grande
  • Lorena. In 2011 CMC purchased Lorena for $8.5m. Lorena has a NI 43-101 compliant resource of 30 million tonnes. This is $0.28/resource tonne.
  • Cote 1/44. In 2012 Compass Minerals purchased Cote 1/44 for $6.5m and a $0.5/t royalty, GDR held the right of last offer (ROLO) on this property and contested the purchase. Cote 1/44 has a potential resource of 80 million tonnes. Discounting the royalty over 20 yrs at 8% this is $0.26/resource tonne.

GDRMI Isabel Footwall Fertilizer Project

This is an in-situ leach project of a 34 m thick layer of water-soluble, largely sulphate evaporite minerals. The unit contains 30% soluble salts identified below the high purity halite deposit at Isabel. The brine generated will be solar evaporated and the harvested salts will be processed for sale. The suitability of the hydrology to enable solution mining needs to be confirmed.

 
Project Highlights
  • Premium fertilizer product
  • Thick layer of soluble sulphate rich evaporite minerals below halite
  • Brine for leaching identified
  • High solar evaporation rates reduce unit operating cost
  • Large potential in surrounding areas
  • Simple and commonplace heap leaching and solar evaporation process planned
  • Low capital cost, and bulk export terminal access and unit cost agreed

 

The Isabel footwall water-soluble evaporite deposit consists of a suite of clastic sediments comprising predominantly conglomerate of volcanic origin, cemented together with economic concentrations of soluble calcium, sodium, potassium and magnesium sulphate minerals identified as glauberite and polyhalite, among others. The sediments show significant increases in water solubility of approximately 30% by mass from approximately 50 m to 90 m below surface. This evaporite unit is open at depth and contains products which are planned to be produced from solar evaporation of solution brines.

Water right applications for solution mining purposes

In addition to the solid evaporite mineral accumulation in the footwall sediments at Isabel, hypersaline groundwater has been intersected in the lower sediments with potassium concentrations of approximately 5,000 mg/L. CMDGR has lodged applications for the abstraction of 6.7 L/s, from each of three extraction wells (20 L/s total) located on the Isabel property, with Ministry of National Assets’ Iquique office. Sea water could also be used as an alternate leach solution.

This is an in-situ leach project of a 34 m thick layer of water-soluble, largely sulphate evaporite minerals. The unit contains 30% soluble salts identified below the high purity halite deposit at Isabel. The brine generated will be solar evaporated and the harvested salts will be processed for sale. The suitability of the hydrology to enable solution mining needs to be confirmed.

 

PDI Engañadora Caliche Project

This project anticipates the surface mining of caliche ore, which will be heap leached using sea water pumped 15 km from the coast. The leached brine will then be solar evaporated and the harvested salts processed for sale. The expected products are K₂SO₄, Na₂SO₄ MgCl₂ and NaNO₃ with Li₂CO₃ and H₃BO₃ as possible by-products. In this area iodine is a significant by-product from caliche mining, but it has not been included in the evaluation at this time. Additional resource potential is projected to exist, both at depth and laterally. This potential has not been estimated and needs to be further delineated by drilling. Higher margin fertilizer products will be shipped via the public port of Iquique or via a nearby private salt export terminal where GDR has negotiated a fixed cost off-peak season fertilizer export contract with a local salt exporter.

 
Project Highlights
  • Caliche ore occurs on and near surface
  • Planned heap leaching with sea water (15km from coast)
  • High solar evaporation rates
  • Close to existing producers
  • Low capital cost, and bulk export terminal access and unit cost agreed
  • Significant potential to increase resource content and grade

 

The Enganãdora property, located to the NE of the Salar Grande basin, covers an area of 2,851 hectares and is host to two types of surface duricrust deposit, known locally as caliche. These deposits contain economic quantities of soluble calcium, sodium, potassium, and magnesium sulphates and nitrates with possible by-products such as boron, lithium and iodine. At Enganãdora, the caliche is present in two forms. A breccia related caliche is found within the tectonically sheared volcanic rocks of the higher lying area of the property. A sedimentary-type caliche is found in the lower lying areas of the property.

 

PDI Hilaricos Heap Leach Project

This project targets the Lomas de la Sal and Loma Sin Nombre water-soluble solid resources for strip mining and ore transport to heap leach pads, followed by solar evaporation of the leach solution. The harvested salts are then processed for sale.

The project area has both a tabular surface sulphate unit with an exposed width of 1.5 m to 3 m. This unit is a distinctive cap to the unexposed halite unit of the Soledad Formation, which lies conformably below. The sulphate unit is found both on the Lomas de la Sal hills as well as the Loma Sin Nombre hill. The unit contains soluble sodium, potassium, and magnesium sulphates and nitrates and iodine as a potential by-product.

Project Highlights
  • Caliche ore occurs on and near surface
  • Planned heap leaching with sea water (15km from coast)
  • High solar evaporation rates
  • Close to existing producers
  • Low capital cost, and bulk export terminal access and unit cost agreed
  • Significant potential to increase resource content and grade

 

 

PDI Hilaricos in-situ Leach Project

A 90 m thick evaporite deposit is host to water-soluble potassium, magnesium and sulphate mineralisation within an extensive gypsum-rich unit. The deposit has been drilled and sampled by PDI. This unique geological feature, being the upper part of the Hilaricos Formation, was originally discovered by ENAP (Empresa Nacional del Petróleo) who drilled an oil exploration well on the property in the early 1960’s. The suitability of the hydrology to enable solution mining still needs to be confirmed. Included on the same property, is the discovery of a large confined artesian aquifer with a 600m head of water reporting on surface at a pressure of 145 kPa, which was intersected in the recently drilled PDI borehole. An application has been made to secure the consumptive rights to 330 L/s of water for mining purposes from this newly defined aquifer.

 
Project Highlights
  • Premium fertilizer product
  • 90 m thick layer of sulphate rich salts identified
  • Large potential in surrounding areas
  • Brine for leaching identified below sulphate seam
  • High solar evaporation rates reduces production unit costs
  • Low capital cost, and bulk export terminal access and unit cost agreed

 

 

Water use applications for solution mining:

 

 

 

Quillagua Artesian Aquifer Project

Potash Dragon Inc., (the “Company” or “PDI”) by virtue of its deep exploration drilling and geophysical analysis has defined two new untapped aquifers in Northern Chile (one being artesian in nature) that are estimated to have an initial capacity in excess of 300 L/s of process water, with very significant upside potential, at elevations between 650 and 1000 m a.s.l.. PDI has recently secured two exclusive water exploration concessions covering 67,239 hectares in N Chile. As such PDI is seeking bids for its private equity offering in its controlled subsidiary, Potash Dragon Inc. (Barbados) (“PDI”), to finance the permitting and development of an independent Chilean water utility company, “GoldWater SpA”.

The newly discovered warm, brackish, artesian aquifer near the town of Quillagua is situated 550 meters below surface. It is hosted within a sequence of coarse conglomerates of the Altos de Pica formation, which are capped by a thick layer of impermeable fine grained clays. The water bearing conglomerates are shown as the yellow area in the cross section and the clays are shown in blue. Based on analysis of the aquifer’s isotope, water chemistry and pressure, it is likely that this confined aquifer has its source within the Precordillera, immediately to the east of the Hilaricos water concessions. Previous exploration for groundwater in this area was unsuccessful as it focused primarily on defining extensions of the near surface Pampa del Tamarugal aquifers that are absent here. The deeper drilling at the Hil No 1 oil exploration well indicated a water intersection at this depth, but the high density drilling fluids would have masked its artesian.

 
Project Highlights
  • New Aquifer discovered in the driest place on earth
  • PDI has an exclusive exploration right over 67,239 hectares
  • Surrounding mining projects constrained by water
  • Surrounding aquifer’s water rights have been maximized to full capacity
  • Mining companies have identified projects worth as much as U.S. $10 billion to source sea water (desalinated and non-desalinated) for their operations

 

Isometric view showing aquifer location:

Wade performing flow tests in January 2016. Flow rate was ~ 1 L/s at a temp of 37 ⁰C with a shut in pressure in excess of 50 psi delivered from the water intersection 550m below surface:Projects

 

PDI Llamara Brine Project

This project targets the Llamara brine resources: The project proposes pumping brine and replacing the brine volume with recharge solution to maintain the water table, followed by solar evaporation of the leach solution. The harvested salts are then processed for sale.

 
Project Highlights
  • Premium fertilizer product
  • Extensive brine resource identified
  • Hilaricos water or Sea water required to maintain aquifer level
  • High solar evaporation rates
  • Very low operating cost with high margins

Sampling Brine at the Huatacondo Puquio:

 

 

 

PDI Solida Carbonate Project

As a result of surface pit sampling of the Solida properties a zone of soluble carbonates was defined. The grades are potentially economic, though no detailed economic analysis has been carried out. Both the lateral and vertical extensions of the water soluble carbonate zones need to be determined followed by an assessment of potential mining and extraction processes.

The Sodium carbonate occurrence within the Solida project area is as a result of precipitation within recently re-worked, near surface, siltstone, mudstone and sulphates within horizontally bedded, unconsolidated fluvial accumulate. The general fluvial direction is from the NE to the SW and is found adjacent to the Cerro Soledad range. The depth of sampling did not exceed 3 m and there may be depth extensions to the deposit. The origin of the water soluble carbonate is likely to be lacustrine.

 

 

 

@ Copyright 2014 - Gold Dragon Resources - Web Design by Web Response
Top