THE POTASH INDUSTRY
Potash is generally found in bedded deposits of marine evaporites or naturally occurring brines. It is extracted from the earth by mining and is processed for commercial use in a surface concentration plant. The principal source of supply in the United States has been from the Carlsbad area of New Mexico where the resources are being rapidly depleted. It is estimated that the resources of potash there will be exhausted in less than 20 years.
In recent years it has been discovered that rich and virtually untapped potash beds are located in the Saskatchewan province of Canada, and the attention of the potash industry is being focused upon production there as the probable principal source of supply for the future needs of the markets in North America and abroad. The quality and the thickness of the ore beds in Saskatchewan, so far as is presently known, are much better than those in Carlsbad. However, the best ore beds known to exist at Saskatchewan are located at a greater depth from the surface of the earth than those in New Mexico, thus creating more serious engineering problems in mining. The evidence does not indicate, however, that there would be an ultimate competitive disadvantage.
There are two methods of mining the ore: conventional shaft mining and solution mining. Presently almost all of the potash produced in North America is recovered from underground beds by "room and pillar" conventional shaft mining. Generally a shaft with an inside diameter of approximately 16 to 18 feet is sunk to the level of the underground horizontal potash bed. The underground workings are extended from the shaft, usually in several directions. Not all of the ore from the beds can be extracted because a certain quantity must be left to support the overlying geological structures. The ore is brought to the surface by mechanical means, crushed, purified and concentrated to the point where it contains approximately 60% K (2)O.
In connection with the depth at which potash can be mined by conventional shaft mining, it was stipulated at the time of trial that "no producer is now mining potash deposits at a depth of more than 3350 feet below the earth's surface by the shaft method. Potash Company of America plans to mine potash in Saskatchewan by the shaft method at depths up to 3465 feet. It is not now known whether it is possible to mine potash found at greater depths by the shaft method."
There are two methods of solution mining described as selective and non-selective. It was stipulated by the parties that "in a selective solution mining process a hot brine saturated with respect to sodium chloride but undersaturated with respect to potassium chloride is circulated underground and is intended to remove the potassium chloride from the underground mineral deposits. In a non-selective solution process a hot liquid undersaturated with respect to both sodium chloride and potassium chloride is circulated underground to extract both these chemicals." Solution mining can be conducted at greater depths than shaft mining.
Because the extensive rich deposits of potash in Saskatchewan are located at greater depths from the surface of the earth than may be feasible to mine by the shaft method, it is likely, as Saskatchewan comes to be the principal source of North American supply, that solution mining will of necessity be utilized to a considerable extent. The areas within which shaft mining can be successfully undertaken, so far as is presently known, are limited. The best ore beds seem from the evidence to be located at depths greater than 3500 feet from the surface of the earth. It has been determined that solution mining is technically feasible and that when some further technological problems are solved, the only difference between shaft mining and solution mining will be a matter of production costs. It has been reported that large scale production by the shaft method is more economical, but on small scale production, avoidance of the initial expense of construction of the shaft mine would off-set the differential in production costs. Another favorable factor is the short period of time within which a solution mine can start to produce.
The feasibility of solution mining and a comparison of costs of shaft mining is set forth in a memorandum to W. E. Wallis of the Producing Coordination Department of Jersey by T. E. Gillingham a consulting mining engineer engaged by Jersey on a consultant basis.
No doubt, in view of the cost differential on large scale production, solution mining will not be undertaken to a great extent until some further technological problems have been solved bringing cost production to a comparable basis with shaft mining, or until the demand cannot be satisfied by resources available for shaft mining. However, one company, Kalium Chemicals, Ltd., has entered into commercial production using a solution mining technique at its facilities in Saskatchewan. The first Kalium shipment of potash was made September 29, 1964. It should also be noted that other companies, including Imperial Oil, have experimented with solution mining and have not entirely rejected ultimate feasibility.
Based on past experience, it seems clear that at least four to five years is required to construct a shaft mine and a surface concentration plant. Preliminary to this is the exploratory work of locating the ore reserves by drilling test holes. Because of the amount of initial capital investment and the period of time before production can begin, entry into the potash industry by shaft mining is limited to companies with substantial capital resources. In lesser degree the same is true of solution mining.
The companies now engaged in North American production in this country and Canada, with date of entry into the industry and with current production or imminent potential production, are shown on the following chart:
DATE OF (TONS KCl OR
COMPANY ENTRY LOCATION EQUIVALENT)
American Potash & 1916 California 350,000
U.S. Borax & 1931 New Mexico 867,000
Potash Co. of America 1934 New Mexico 1,040,000
1965 Saskatchewan * 600,000
Bonneville, Ltd. 1938 Utah 100,000
International Minerals 1940 New Mexico 665,000
& Chemical Corp. 1963 Saskatchewan ** 1,600,000
Duval Corp. 1951 New Mexico 551,000
Southwest Potash Corp. 1952 New Mexico 1,000,000
National Potash Co. 1957 New Mexico 450,000
Kalium Chemicals, Inc. 1964 Saskatchewan 650,000
Texas Gulf Sulphur 1965 Utah 550,000
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