Lake Wells SOP Project

Australian Potash’s Lake Wells Sulphate of Potash Project is located approximately 500km northeast of Kalgoorlie, in Western Australia's northeastern Goldfields and consists of granted mining leases and exploration licences covering over 1,200 square kilometres.

Lake Wells SOP Project is the flagship project for Australian Potash Limited.  The project is a long-life operation of more than 30 years, with strong economics and good local and regional employment opportunities for up to 80 people in steady state operations.

Technically the Lake Wells SOP story is compelling. Using the sun and the wind, with high-penetration renewable power, we will produce organically certified, environmentally sustainable, green Sulphate of Potash that will go to the world’s most productive and high-value markets. Our tier 1 distribution partners across the globe will supply K-BriteTM into the horticultural and agricultural sectors responsible for feeding more than half the world’s population: China, Europe, North America, Asia and Australia/New Zealand. Our project financials indicate a substantial net present value, supported by a very robust healthy margin on the product.

History

In 2014 a Company geologist, following a hunch, dug a hole in the salty crust of a section of the Lake Wells lake system and collected samples of brine. In mid-2014, those assays came back with significantly elevated potassium and sulphate levels. These assay results were not, however, a complete surprise.

In 2013, Geoscience Australia had released the findings of a research program where they had assessed and ranked all of Australia's salt-lake systems for the potential to host a range of elements, including lithium, potassium, magnesium, sodium, and other minor industrial minerals. This research led to the initial interest in looking at the Lake Wells area for minerals other than gold and base metals.

In September 2014, the Company started shallow aircore drilling into the lake. The drilling confirmed the potassium (K) content of the brine. Along with potassium, the second key element of interest is sulphur (S) in the form of sulphate (SO4), and again the concentrations of SO4 met or exceeded guidance for a potential economic deposit: as the brine could make SOP.

As with other well-known palaeovalley systems in the eastern Goldfields, the target was a deep palaeochannel with a coarse basal sand aquifer. Geophysical test work involving passive seismic techniques was successfully employed in identifying an extensive palaeovalley system.  Further drilling and definition have resulted in the current Lake Wells SOP Project.

Mineral Resource

A maiden JORC-compliant Mineral Resource was released in June 2016 (refer ASX Announcement). A Resource upgrade, based on extensive hydrogeological data and rigorous modelling, and subject to newly released reporting guidelines, was completed in August 2019 (refer ASX Announcement):

LSOP Mineral Resource

The Measured Resource is a static estimate of the volume of potentially recoverable brine that is contained within the defined aquifer.  A groundwater flow model has been developed to stimulate brine abstraction scenarios.  This model has been calibrated and then used to simulate the rate and concentration of potassium that can be abstracted to meet a targeted production rate of 100,000tpa of SOP for mine life scenarios of up to 30 years.

The modelling resulted in determination of a Probable Reserve of 3.6Mt, which was released in the Definitive Feasibility Study (DFS) in August 2019 (refer ASX Announcement).

FEED Study

The Front End Engineering Design (FEED) Study was completed in April 2021 (refer ASX Announcement).  The FEED completed optimisation of the outcomes of the DFS across four main areas:

  • borefield design;
  • harvest and pre-concentration pond design;
  • product variants; and
  • project schedule. 

FEED positioned K-BriteTM at the premium end of the global SOP market.  Optimised sustainable SOP development will produce 170,000tpa for distribution across the world's most lucrative markets.

The FEED outputs are summarised below:

FEED Highlights

Project Development

The early works development program involved first stage construction of the accommodation village and establishment of the first brine production bores.

Infrastructure associated with a 20-person permanent camp incorporated ensuited rooms, tavern, kitchen, dining room and fresh and wastewater treatment plants and this was completed in Q3 2021.

The FEED program identified an optimised borefield design comprising 79 brine bores and the development of two raw (or fresh) water borefields comprising approximately 13 bores. Prior to mobilisation of equipment for the first phase production bore drilling program, APC had developed several bores at Lake Wells; three of these are considered suitable to take forward into operations. 

Through the first phase program, 17 bores were developed, taking to 20 the number of brine production bores that will be utilised during start up and continue through steady state operations. On a linear basis this represents the development of over 25% of the LSOP's borefield; but on a volume basis the bores developed to date account for approximately 35% of required brine flow for full scale production.

The Lake Wells' evaporation network comprises on-lake pre-concentration ponds and off-lake HDPE lined harvest ponds.  460 geotechnical test sites sampled across the surface of the lake system have identified a consistent layer of clay, preventing vertical seepage of brine and the pre-concentration pond construction methods were trialled and demonstrated the veracity of the design.  The evaporation pond development does not rely on long transfer pipelines or trenches.

The LSOP evaporation pond development does not rely on long transfer pipelines or trenches of pre-concentrated brine.  The operating model includes a ‘buffer’ pond at the start of the network, which will be fed year round from the borefield. The purpose of the buffer pond is to enable the storage of brine supply during the low evaporation periods (winter), that can then be discharged at a greater rate than is possible from the borefield directly, in the peak evaporation periods (summer) to better manage the pre-concentration ponds, to ensure they do not dry out and that the correct chemistry is maintained. The buffer pond fluctuates between 0.5m - 3.5m of brine depth and will hold, at peak capacity, up to 25% of the total annual LSOP brine demand.

Thorough testwork across select aspects of the evaporation model is continuous and ongoing with the next sequence of work, currently underway in Australia and the US, comprising:

  • Additional evaporation trials to map the ionic chemistry as the brine evaporates, which testwork is informed by additional data from the bores completed in the first phase program;
  • Analysing and reviewing the expected solid salts composition from the harvest ponds;
  • Translating harvest pond salt composition to the Veolia package to complete confirmatory testwork on the flow sheet, based on design values provided by Novopro; and
  • Completing crushing testwork to size equipment.

The Lake Wells’ processing design is based on the reliable and proven ‘North American’ flow sheet with direct schoenite flotation and belt filters.  It has been used successfully at the largest ex-China solar SOP producer for over 50 years and several contemporary developments using similar flow sheet design have commissioned successfully and transitioned to profitable operations.

The Lake Wells’ processing plant will be contracted on an Engineering-Procurement-Construction (EPC) basis providing process, time and cost guarantees from a successful Western Australian engineering head contractor, GR Engineering Services Limited, which is a specialist EPC contracting firm with exposure and experience to the SOP sector.

The technical and development works undertaken to date have positioned LSOP as fully permitted and shovel ready.