POTASH MINING – New producer slated for New Brunswick

NEW BRUNSWICK - Saskatoon-based POTASH CORP. OF SASKATCHEWAN has plans to build a new 2.0-million-t/y mine near Sussex. The US$1.6-billion project includes both the new mine and a US$100-million expansion of the mill facilities. PotashCorp says that when the project is completed in 2011, the company will have total annual potash capacity of 14.9 million tonnes.

The new mine will be developed in the Piccadilly deposit, which has grades similar to those in Saskatchewan. Piccadilly is a relatively flat deposit containing two seams, each varying in thickness to a maximum of 18 metres. Once fully developed, the new mine will replace the existing Sussex underground operation, while the current milling facility will be expanded by 1.2 million t/y, including 750,000 tonnes of additional compaction capacity.

Because this new mine will be built adjacent to the existing operation and use some of its facilities, construction can be completed in less time than the five to seven years typically projected for a greenfield potash operation, at a per-tonne-cost 33% below the current estimate of $2.22 billion needed for a new mine of comparable size in Saskatchewan. Plans are to keep the existing mine and mill fully operational throughout the construction and new mine development process.

The construction phase is expected to generate the equivalent of 2,500 person-years of employment, and 140 new fulltime positions will be created upon completion. The project will be financed out of free cash flow and existing credit facilities.

The New Brunswick development is in addition to previously announced debottlenecking and expansion initiatives underway at the company's Lanigan, Patience Lake and Cory operations in Saskatchewan, which are expected to increase PotashCorp's productive annual capacity from 10.7 million tonnes today to 13.7 million tonnes by the end of 2010.

The slideshow posted July 20 at www.PotashCorp.com contains details of the company's plans for expansion through 2015.