viewHighfield Resources Ltd

Highfield Resources progresses Muga Potash Project mining concession dialogue as next step towards construction

The company is continuing discussions with potential potash and salt offtake partners as part of its sales and marketing strategy.

Highfield Resources Ltd -
Highfield had A$28.7 million cash in bank at the end of the June quarter

Highfield Resources Ltd (ASX:HFR) (FRA:23H) is engaged in ongoing dialogue with relevant authorities in order to progress the mining concession material for Muga Potash Project in Spaid, which is the next key step in its critical path to construction.

In its latest quarterly activities report, Highfield said that its main achievements included appointing a new chief executive officer in Pamplona - Ignacio Salazar - continuing its execution of the sales and marketing strategy and receiving positive assays results at Muga.

The company held A$28.7 million cash in bank at the end of the June quarter.

Muga Project approvals process

Following the submission of the Mining Concession documentation, and despite the Spanish confinement program due to COVID-19, Geoalcali maintained constant dialogue with the relevant authorities to expedite the process.

On June 22, the nationwide COVID-19 State of Alarm in Spain was lifted, and soon after, on July 4, the start of the public exposition period with respect to the mining concession documentation was gazetted in the National Bulletin.

The public exposition period will last 30 working days after which Geoalcali will have an opportunity to respond to any queries brought forward.

Highfield estimates that the mining concession will be awarded by the end of the fourth quarter of 2020.

Muga and Vipasca permit technical update

During the quarter, design development continued to progress in line with the project program timetable and engineering submissions were made by the principal equipment suppliers and engineering consultants.

As a result, basic design of the process plant is advancing well and detailed design is ongoing.

K-Utec AG Salt Technologies has completed the test-work that will be used to detail the systems and components necessary for the dewatering and backfilling system and continues to progress the basic design work for the backfilling storage and placement systems.

Geoalcali is also carrying out additional lab work to further optimise the salt quality specification that will be produced from the Muga Mine.

Geotechnical drilling and other site investigation works started in June 2020, as soon as free access to the site was available after the lifting of the national State of Alarm.

The program was around 50% complete at the end of the quarter.

Sales and marketing update

Geoalcali continued the successful execution of the group’s sales and marketing strategy by signing a non-binding offtake MOU with Maxisalt.

Under this MOU, Geoalcali will provide up to 500,000 tonnes per annum of salt to Maxisalt, comprising 400,000 tonnes of vacuum salt, a higher value product, and 100,000 tonnes of de-icing salt.

Geoalcali continues to engage in ongoing offtake discussions with other potential wholesale customers, distributors and global traders for the entire production capacity of muriate of potash and salt from the Muga Mine.

Next steps

Highfield will remain focused on the following activities for the remainder of the year:

  • Continue to maintain an open dialogue with all relevant authorities throughout the public exposition period process;
  • Respond to any queries once the public exposition comes to a close;
  • Continue project optimisation work and continue with detailed design;
  • Sign the purchase contract for two bolter-miners; and
  • Continue discussions with potential potash and salt offtake partners as part of the company’s sales and marketing strategy.

Quick facts: Highfield Resources Ltd

Price: 0.55 AUD

Market: ASX
Market Cap: $181.24 m

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