Branching out from its key oil and gas concessions in Argentina’s prolific Neuquen basin, Calgary-based oil and gas junior Americas Petrogas (BOE-V) is taking on a new potash project along Peru’s northwestern coast.
Earlier in the year, Americas signed an option agreement the Peruvian government’s Agency for Promotion of Private Investment (ProInversion) to be able to acquire a 70% working interest in the 821-sq.-km Bayovar potash concession located in the Sechura desert, in the region of Piura.
The site benefits from good infrastructure and the kind of hot, dry weather best suited for brine ponds.
The company paid ProInversion US$656,000 and committed to spend US$600,000 on further studies during the next two years. As of March 31, 2009, Americas had about $5.5 million in cash and equivalents that may be used without restriction.
In May, Americas Petrogas signed an agreement with the Community Foundation of San Martin de Sechura that permits Americas the unconditional right of surface access in respect of the Ramon and Zapayal potash brine reservoirs and evaporite deposit, located on the Bayovar concession.
The company is now moving forward with more resource and environmental assessments, exploration and other feasibility work.
It has hired the German consulting firm Ercosplan to prepare a preliminary brine resources assessment study for the concession’s surface potash brine reservoir and solid evaporate deposits.
The Bayovar potash concession already contains small evaporation ponds that were part of a previous pilot plant.
With 77.9 million shares outstanding, Americas Petrogas last traded at 30 cents within a 52-week range of 10-48 cents.
Vale (VALE-N) also has fertilizer assets in the area.
The Brazilian giant is now building the Bayóvar phosphate project, expected to come on stream in the latter half of 2010, with an estimated capacity of 3.9 million tonnes per year and budgeted capex of US$479 million.
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