South Boulder Mines (ASX: STB) is maintaining momentum in building the Colluli Potash Project in Eritrea, where independent feasibility study activities continue to define a world class project. South Boulder are currently targeting 1.5 billion tonnes of potash at 20% KCL, which has an in ground value of about USD $150 billion, dwarfing other basic project valuations of companies and commodities comparing market capitalisation to in ground value.
To put the company into perspective, South Boulder has a market capitalisation of only A$240 million.
South Boulder is also expecting very low mining costs for the project due to the open pit aspect, with Eritrea offering a stable geographic operating environment. Exploration at the newly defined Area B Prospect continues to intersect potash from depths as shallow as 20 metres. South Boulder said assays have yet to be returned from this new discovery area but sylvinite, which is a typically high grade ore, has been visually identified in core from 10 holes.
At Area A, drilling has identified potash outside of the current JORC Resource. A Scoping Study is forecast for completion in August 2011, with feasibility studies expected by mid-2013, with the first potash production scheduled for mid-2016.
Colluli has a current JORC Resource of; 33.39 million tonnes at 18.56% KCl of Measured Resources, 173.37 million tonnes at 18.57% KCl of Indicated Resources and 340.86 million tonnes at 18.58% KCl of Inferred Resources.
The total is 547.62 million tonnes at 18.58% KCl, for total contained potash of 101.73 million tonnes. An engineering Scoping Study is underway into open pit mining and processing to produce up to 10 million tonnes annually of potash.
South Boulder will also soon list on the OTC/QX Exchange.