Gensource Potash Corp. has released the results of a feasibility study for its Vanguard One potash project in Saskatchewan that indicates the operation will have a posttax net present value, at an 8% discount rate, of US$235.8 million and internal rate of return of 16.31%.
The 250,000 tonne-per-annum mine is expected to cost about C$279 million to build, with construction taking just under two years.
The TSX Venture Exchange-listed company said May 31 that the project will require average annual sustaining capital of C$15.68 per tonne, or about C$3.3 million.
Under the base case scenario, which assumes a potash price of US$300 per tonne, payback is expected to take 6.3 years.
The feasibility study recommends bringing the Vanguard project into production.