INDUSTRIAL MINERALS — Atacama nears production on Chilean evaporites

Atacama Minerals (AAM-V) is gearing up to become a producer of industrial mineral products in Latin America.

The company’s wholly owned Aguas Blancas project comprises 22,000 ha in Chile’s Atacama Desert, 95 km southeast of the port of Antofagasta.

Atacama, formerly known as Boron Chemicals International, plans to mine and process caliche ore on-site. Caliche ore contains high concentrations of the evaporite minerals sodium sulphate, sodium iodide and sodium nitrate. After processing, the end-products are commercial-grade iodine, detergent-grade sodium sulphate and fertilizer-grade potassium nitrate.

The deposit at Aguas Blancas consists of a flat-lying layered series of bands of caliche which vary in thickness. Measured, indicated and inferred reserves weigh in at 97.4 million tonnes of iodine ore grading 580 parts per million iodine and 43.2 million tonnes of 27% sodium sulphate ore.

At full operating capacity, Atacama hopes to produce 1,035 tonnes of commercial-grade iodine (99.8% pure), as well as 300,000 tonnes of detergent-grade sodium sulphate (99% pure) annually. Based on these reserve estimates, the mine has an estimated life of 21 years.

In addition to the two main products, the caliche ore also contains about 4.5% sodium nitrate. The company believes this resource can be converted, on an annual basis, into 70,000 tonnes of fertilizer-grade potassium nitrate. However, potassium nitrate production will not commence until year seven of the mine’s life.

Capital costs for the mine, chemical processing plant and related infrastructure are estimated at US$120 million. In February 1998, the company received a joint offer from ABN AMRO Bank and Dresdner Bank Canada to underwrite a US$77-million loan. The offer is subject to due diligence and closing documentation. Atacama hopes it can acquire the necessary financing in order to put the mine into production by mid-1999.

The company has completed a bulk-mining test and chemical analysis. A total of 46,000 tonnes of ore was mined during the test period. Preliminary indications of the chemical analysis show higher-than-expected averages of iodine, sodium sulphate and sodium nitrate. Compared with values from a 3-hole, reverse-circulation drill program in the area of the test pit, the bulk samples contained an average of 7% more iodine, 353% more nitrate and 51% more sulphate.

Although Aguas Blancas lies in a remote arid region, infrastructure at the site is relatively good with a railway and the paved Pan American highway passing within 15 km of the property. “Over the past several months, a significant investment in both capital and people has been made by the company to develop the infrastructure necessary to support the plant construction schedule,” says Robert Cogliandro, president of Atacama.

The company has signed a multi-year agreement with GasAtacama, a consortium of CMS Energy and Endesa, to supply up to 10 MW of power to the Aguas Blancas mine. The contract will supply all the company’s power needs.

In this arid region, access to adequate water supplies is a crucial element of the treatment process. Atacama has identified ample water resources by drilling a series of wells that will yield more than what is needed for process requirements. The company has also received official approval to exploit these aquifers.

Mining and processing

The ore will be mined by a continuous system. Broken ore of a maximum size of 6 inches will be loaded on to trucks and transferred to a stockpile near the leaching area. The leaching area will have a storage capacity of seven days. The mine will be operated during two daily shifts for 345 days per year.

The ore is processed by means of leaching in order to extract the soluble minerals.

The leach circuit consists of four leach tanks in series to provide the conditions for dissolution of the ore by heated leach water in counter-current to the ore.

The product of this highly temperature-sensitive stage is a near-saturated sodium sulphate solution containing 0.5 gram iodine per litre as the iodate ion (IO3+). The clarified brine from the leach circuit is filtered and pumped to the iodine plant.

A 3-stage process recovers 87% of the contained iodine. First, the iodate is converted to iodide ion in a reaction tower by reduction with sulphur dioxide. Elemental iodine is made by reacting iodate and iodide ions under acidic conditions, and then the iodine product is melted and purified.

Sodium sulphate

The remaining brine solution from the iodine recovery plant is saturated in sodium sulphate. The brine also contains dissolved sodium and potassium nitrates and sodium chloride.

The next step in the recovery procedure is known as the “salting out” process. Sodium chloride is added to the brine in order to displace and precipitate the sodium sulphate. The sulphate crystals are then separated from the brine by centrifuging. The residual brine solution is saturated in sodium nitrate and is called the “end brine” solution.

Potassium nitrate

The end brine is sent to a series of solar evaporation ponds to precipitate sodium and potassium nitrate as well as lesser amounts of sodium sulphate, magnesium sulphate and sodium chloride.

These salts are leached into a hot nitrate brine solution and then thickened into a slurry and separated in a centrifuge process. The nitrate brine recovered is fed to a tank where commercial-grade potash (potassium chloride) is added to precipitate solid sodium chloride from the potassium nitrate solution. The sodium chloride is separated by centrifuge, and the potassium nitrate solution is transferred to a feed tank and then to a potassium nitrate crystalliser. A precipitate of coarsely crystalline potassium nitrate slurry is formed and is passed through a final centrifugal process for de-watering and washing. The resulting potassium nitrate cake is dried, screened and bagged.

Iodine is a specialized commodity used in the manufacture of X-ray contrast media, herbicides, fungicides, disinfectants, pharmaceuticals and certain industrial chemicals. Studies indicate that other potential applications include chlorofluorcarbon (CFC) substitutes, and water purification. The current price of iodine is about US$20 per kg.

Sodium sulphate is used as a filler in the production of powdered detergents. It is also used in the textile and pulp and paper industries. Current prices are about US$120 per tonne. Potassium nitrate is used specifically as a fertilizer and sells for about US$325 per tonne.

Atacama has 53.4 million shares fully diluted and working capital of $14.7 million.