A junior mining company with plans to build a potash mine on a reserve northeast of Regina says two new 20-year agreements to sell a total of seven million tonnes of potash annually bring it one step closer to financing and building the massive facility.
The agreements, known as offtakes, with “bankable” India-based firms should help Encanto Potash Corp. secure the $3 billion it needs to build the mine on Muskowekwan First Nation, said the Vancouver-based company’s director of corporate development.
“We think that with this offtake, we can get our corporate financing,” Gary Deathe said, adding that while no junior mining company has successfully financed a potash operation into production, that is “100 per cent” Encanto’s plan.
Encanto has been exploring the possibility of a mine in the province for years. It expects the mine will take three years to build and create hundreds of jobs. In 2010, it signed a joint venture deal with Muskowekan First Nation to develop the region’s potash resources.
Earlier this year, Muskowekan Chief Reg Bellerose told the Regina Leader-Post that while the project was not supported by every member of the First Nation, it had been approved by a majority in several votes.
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