Potash Ridge (TSX:PRK)(OTCQX:POTRF) CEO Interview


Potash Ridge
CEO: Guy Bentinck




Juan Costello:  Good day from Wall Street, this is Juan Costello with a Wall Street Analyst.  Joining us today is Guy Bentinck, the CEO for Potash Ridge.  The company trades on the Toronto Stock Exchange, ticker symbol is PRK and now trades on the OTCQX, ticker symbol is POTRF.  Thanks for joining us today Guy.

Guy Bentinck:  Thank you, you are welcome.

Juan Costello:  Great now starting off give us a brief history and overview of the company for some of our listeners here that are new to your story?

Guy Bentinck:  Sure, well Potash Ridge owns a property in Utah; the property is called the Blawn Mountain Project.  It’s based in Southwest Utah about equal distance between Salt Lake City and Las Vegas it’s about three hours from either city.  It’s in a very remote location, but it is a land that is one hundred percent state owned land and it is designated land that is designated for development.  The ore that we are planning to mine is something called Alunite, Alunite is a volcanic rock and when you process that ore you essentially get two main products one is Sulphate of Potash which is a high grade potash that basically sells at a premium of around fifty percent over regular potash and also a bauxite material, bauxite is the feed stock that is used for the production of aluminum.  So where we are in the project is that we have a preliminary economic assessment done.  That was done late last year, by the end of June we will have a prefeasibility study out and we are, we have drilled sufficient holes to demonstrate that we have over a thirty year worth of a mine life and that is only about half of the property drilled so we do expect that the mine life could be larger or we could potentially increase production at a second phase.  We are scheduled to get all the feasibility that that the bankable feasibility study and the permitting done around mid 2014 with a viewpoint to constructing and being in commissioning stage by late 2016.

Juan Costello:  Great and so yeah talk a little bit more about the Blawn Project.

Guy Bentinck:  Yeah so in terms of this property as I said it’s in a very remote location of Utah, but that being said we are very close to all the required infrastructure whether that’s roads, rail lines, power lines, gas lines so we are in very great situation there, in that there is very little infrastructure that’s required to build in order to make this project up and running.  The really interesting aspect of this project is in fact, that this deposit was extensively evaluated back in the 1970’s, ultimately the project at that time didn’t move forward because by the early 80’s when the project was permitted the US economy was in stagflation so they with fourteen percent interest rate and fourteen percent inflation, it wasn’t financeable.  But there was an extensive amount of work done including drilling, including three years pilot plant work and that pilot plant actually mirrored how SOP, Sulphate of Potash and alumina have been produced from this type of ore in the past including a plant in Azerbaijan that operated from the 1960’s through to the mid 1990’s and so back in the 1970’s the pilot plant tested exactly the same process that was used in Azerbaijan and so we have acquired all of that historical data which actually allows us to expedite the development of this project which is in fact what we are doing.  One of the things that we have embarked upon now is our metallurgical testing program that’s been ongoing now for several months, but as of earlier this week we actually announced that we have started doing pilot scale testing.  So that started, that will continue on for a few more months and a lot of this is just simply confirming the historical information that we already have and looking at ways using modern technologies to potentially optimize recoveries from what was encountered back in the 1970’s.

Juan Costello:  Well, great and what are some of the other trends that you are seeing right now in your sector and how you are positioning the company to capitalize on them?

Guy Bentinck:  Very good question, I think when you look at the potash thing generally, most of the potash that is produced is mostly in Saskatchewan and Russia is something called MOP or Potassium Chloride that’s the sort of bulk, bulk potash that is primarily used for field crops wheat and corn and so forth.  What our potash is used for is more of the high value crops so the fruits, the vegetables, the teas, the tobaccos; crops that really are less tolerant to the chloride that you get in MOP and because of the fact and our potash is because it’s potassium and sulfur both of which are nutrients, this is an organic fertilizer and because of the higher yields and the better quality crops that you, quality food that you get out of using this potash over potassium chloride as I said before, it trades at a significant premium about fifty percent over regular potash.  There is a whole bunch of potash projects out there around the world and in the US, in Saskatchewan, in Africa, but for the most part these are all MOP projects and the SOP market is actually quite thin.  There is a, it’s a huge demand for SOP, but today the market can’t serve and so we believe that we will be able to enter this market primarily into the US and Asian and maybe Brazilian markets and be able to supply our product at the same level of premiums that you are seeing today.  The bauxite story is an interesting one as well, there is a surplus of capacity of aluminum today, but there is in fact a deficit of bauxite and there continues to expect to be a deficit of bauxite and a lot of countries around the world China included are building bauxite processing plants and really have a huge and growing demand for bauxite so we believe that this material, which is essentially a byproduct of our flow sheet we should be able to sell at reasonable premiums as well.

Juan Costello:  Great and what are some of the other factors that you feel make PRK unique from some of the other players in the sector?

Guy Bentinck:  I think if you look at our project and you look at the potash thing generally first of all as I mentioned we are selling premium potash, premium products always sell.  Secondly, unlike most potash projects around the world this is a surface mine and that’s important because when you are mining on the surface there is lower risk, it is lower cost and you have access for the ore for whatever test works that you do.  Most potash projects are very deep underground, you know fifteen hundred feet if not deeper and not that obviously cost a lot more money both in terms of drilling holes, shafts or the mining cost to extract the stuff.  Another unique aspect is as I said before the infrastructure aspects of things, we don’t need any major infrastructure to make this project happen and another important factor is that we are a one hundred percent state owned land and that’s very important from a permitting perspective.  If you are on federal land in the US, on mining or other resource projects you will typically fall under the federal permitting rules, which are typically much more on risk and much more time consuming to get through on our project with, we only require state permits that’s by twenty or so permits that we need and Utah is in fact one of the best jurisdiction frankly in the world for mining and it’s permitting process is extremely efficient.

Juan Costello:  Great and perhaps you can walk us through your background, an experience guy and talk a little bit about the management team there?

Guy Bentinck:  Yes excellent question.  My background is I have been in the resource sector for well over twenty years.  I was previously with a large diversified resource company up here in Canada called Sherritt International.  I was with Sherritt for about thirteen odd years, about four of those years I was a Chief Finance Officer and in that capacity I have raised over three billion dollars of debts and equity in public markets, I have raised over two and a half billion dollars of project financing.  Within Sherritt as well I also created and headed a group called capital projects and in that group I really oversaw the development and the execution of several projects anything ranging from a couple of hundred million dollars all the way up to about five billion dollars and essentially anything from early stage all the way through to shovel in the ground construction project, so either very interesting mix of finance raising expertise as well as developing teams to execute projects and really that’s what I have done with this company as, since I joined in the fall of 2011 when essentially this corporation was formed.  I have created a team here of individuals whether it is in the finance side, the operations side, the geological, metallurgical side of things, on the permitting side all of these executives have had experience in bringing projects forward from the exploration through the development and into the operation stage and so what we have here is a team of people that know how to execute projects.

Juan Costello:  And what are some of the goals and milestones that you guys are hoping to accomplish over the course of the next twelve months?

Guy Bentinck:  Well I think our first one is going to be the publication of our feasibility study, which as I said is scheduled for June, end of June this year 2013.  After that we do expect there to be other milestones throughout the balance of this year and mostly surrounding the permitting side of things.  As I said we have about twenty permits, we are expecting to complete our air monitoring work that is required in around the August, September timeframe and the combination of this year will be two things the end of our metallurgical test work, which is including the pilot plant together with filing our large mining permit and that will service up through to 2014 and the big milestones in 2014 will be us completing the bankable feasibility study as well as receiving all of our permits which we, both of which we expect to happen in – by mid 2014.  What I am spending a lot of my time on this year and that we would hope that we can announce something on is working on the uptake of the products as well as the financing for the project.

Juan Costello:  Good and as far as investors in the financial committee that you are concerned Guy as you recently just listed on the OTCQX last month and as you get your message out to investors what you wish they better understood about the company?

Guy Bentinck:  I think the potash thing or the fertilizers thing generally, particularly in the junior side of things you know have taken, has taken a bit of a beating over the last few months.  So I do believe that there are buying opportunities in this sector because the fundamentals for fertilizer and for potash in particular are still fundamentally sound.  When you look at our project you know you, there are as I said a number of very significant competitive advantages to our project when you compare us against others.  The first, the most important is that we are producing two products not on the potash but also this bauxite material.  Great jurisdiction with established infrastructure, state owned land which makes the permitting process a lot more efficient, all of this historical work that I talked to about earlier is allowing us and we will continue to allow us to expedite the development and we are going to be, we expect to be the lowest cost producer of this potash when we are up and running, both because of the fact that were surface mine as well as the fact that we have this bauxite byproduct and we are a long life mine, we are at least a thirty year mine life so we got a potential to expand.  So I think all those competitive advantages would be things that I would say are differentiators against our competitors.

Juan Costello:  Well great and so ones again joining us today is Guy Bentinck, the CEO of Potash Ridge.  The company trades on the Toronto Stock Exchange, their ticker symbol is PRK as well as on the OTCQX, ticker symbol is POTRF currently trading at 50 cents a share and before we conclude here Guy to briefly recap some of your key points, why do you believe investors should consider the company as a good investment opportunity today?

Guy Bentinck:  As I said the fundamentals of the Potash sector are sound.  There is a, certainly in my mind the entire sector is discounted due to some short term issues, but longer term and medium term I believe that there should be a recovery in the sector generally and so on that basis I think that our stock is certainly of great value today and when you compare ourselves to a lot of our competitors, you know we have, we are a very attractive story and we have a great team in place and we have a roadmap to execute this project.

Juan Costello:  Well we certain look forward to continue and track your company’s growth and report on your upcoming progress and we like to thank you for taking the time to join us today Guy and update our investor audience on Potash Ridge.

Guy Bentinck:  Yeah thank you very much.


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