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A report to Australian Securities and Investment Commission.
The Yaringa East well drilled by the Company in February 2000 intersected a
40 metre evaporite horizon in the Dirk Hartog formation. The horizon intersected
contained only halite (salt) with very low levels of potash. However the Bromine
level in the halite was high (290 ppm) indicating a late stage in the
evaporation cycle favourable for potash deposition. Results of drilling suggest
that the area likely to contain potash mineralisation lies to the north and west
of the Yaringa East hole position. New licence applications have been made by
the Company to cover the ground to allow this theory to be tested. The Company
has prepared a special submission to the Department of Minerals and Energy in
support of its licence applications, as three of the four applications cover
ground inside the Shark Bay World Heritage Area.
CHANDLER POTASH - ALUMINA PROJECT
The Company recently obtained an option to acquire 100% interest in the
Chandler Alunite deposit located 260km east of Perth and 50km north of Merredin
in central wheat belt area of Western Australia.
The Chandler Project area hosts a resource of alunite clay believed to be in
excess of 10 million tonnes. Alunite is a potassium aluminium hydroxy sulphate
amenable to processing into potassium sulphate, aluminium sulphate and high
grade alumina.
The project tenements comprise two granted Mining Leases of 385 hectares and
a surrounding Exploration Licence (Application) of 150sqkm. The site is serviced
by the Goldfields Water Scheme and close to the main Muja-Kalgoorlie Grid Power
Line. Exploration to date has established a Measured Resource of 4.7 million
tonnes of ore grading 6.1% K(2)O to a depth of only 2.1 metres in Lake Chandler
itself. A much larger global resource exists below and outside the Measured
Resource and in adjacent lakebeds thus at the planned throughput the current
measured resource is adequate for over forty years production.
The Company has commenced feasibility studies for an operation processing
100,000 tonnes of ore per annum which would provide an annual revenue stream in
the vicinity of $20 million.
The consideration for exercise of the option to acquire 100% of the project
is $15,000 cash plus the issue of two million fully paid Britannia shares to the
vendors. A royalty of $0.5 per tonne of ore mined is payable to a third party up
to a ceiling of $1 million.
The Company believes that the Chandler Project represents an excellent fit
with its other Potash projects with potential for early profitable development.
DANDARAGAN POTASH PROJECT -BRITANNIA 100%
The Dandaragan Potash project is based on large resources of the mineral
Glauconite which occurs extensively in marine greensand deposits in the Gingin -
Dandaragan area 100 - 1501cm north of Perth, Western Australia.
The deposits outcrop over a large area on the western slopes of the Darling
Scarp in two formations. Over much of the area, the upper Poison Hill greensand
formation is separated from the lower Molecap greensand by a thin layer of the
Gingin chalk. Combined thickness of the two greensand formations exceeds 40
metres in much of the area. Consequently the resource base is extremely large.
The Company holds two Exploration Licences (E70/2244 and 70/2248) of total area
244 sqkm, hence is in a position to prove up very large potash tonnages should a
viable treatment process be developed.
While Glauconite has been used extensively in the past as a potash mineral in
agriculture by direct spreading, because of its low grade (5% Potassium) its use
declined with the advent of high grade refined potash products (40 - 52%
Potassium). Consequently work by Britannia has aimed at producing high grade
potash products primarily potassium sulphate from glauconite concentrates by
leaching with sulphuric acid and a number of other sulphate sources.
Testwork confirms that high recoveries of Potash can be obtained from the
Glauconite but the current process is non selective and results in considerable
dissolution of iron and other salts which consume acid and contaminate the
potassium sulphate product. Further trials are being conducted to improve on the
selectivity of the current acid process and further develop other leach
processes which have shown promise.