Magna Resources Ltd. (Magna) (CNSX: MNA) is pleased to report that American Potash LLC (American Potash), a Nevada limited liability corporation owned 50% by each of Magna and Confederation Minerals Ltd. (Confederation), has received from the Arizona State Land Department the approval of five mineral exploration permits totaling 3, 200 acres and the request for plan of operations for eight additional mineral exploration permits totaling 3, 223 acres. These, together with the pending Bureau of Land Management (BLM) potassium prospecting permits, total 9, 690 acres of land available to American Potash for drill testing in Arizona. Relative to the BLM potassium prospecting permits, American Potash has received a letter of request from the BLM for exploration program proposals, the precursor to final permit approval.
American Potashs exploration permits are located 30 kilometers southeast of Holbrook, Arizona, in the SW portion of the Holbrook Basin. Land status consists of checkerboard Arizona State Lands and BLM lands. American Potash permits cover both Arizona State lands and BLM lands where the Arizona Geologic Survey indicates potash thicknesses of 3 to 6 meters.
The Holbrook Basin is a sedimentary basin located in east-central Arizona comprised of extensive salt deposits localized in the Permian-aged Supai formation. Potash underlies approximately 1, 500 square kilometers of the Basin. Previous drilling by Arkla Exploration Company, Duval Corporation, and others drilled a total of 135 potash exploration holes in the 1960s and 1970s. They reported the presence of potassium minerals in the main potash pay zone, with grades of 6% to 20% potash at depths of 300 to 440 meters. Thus, potash deposits of the Holbrook basin may be favorable to conventional underground or solution mining as faulting and layer disruption from diapir affects common to salt deposits are minimal. Conventional mining at depths of 300 to 450 meters may be profitable at current potash prices. The potential grades are conceptual in nature, there has been insufficient exploration to define a mineral resource and it is uncertain if further exploration will result in the target being delineated as a mineral resource. Confirmation for remaining permits for Arizona State and BLM acreage is expected soon.
American Potash also has 31 BLM potassium prospecting permit applications covering approximately 63, 000 acres (25, 500 hectares) of BLM land within the Paradox Sedimentary Basin in southeast Utah, USA. The potash prospects are located approximately 30 miles (48 km) west of Moab, Utah and 20 miles (32 km) from Intrepid Resourcess Cane Creek solution potash mine. The BLM potassium prospecting permits, if and when granted, will provide American Potash with exclusive rights to explore potash deposits within the permit area. A detailed description of the Utah potash prospects are provided in Magnas June 3, 2009 news release.
With the exception of permits already issued in Arizona, all references to the Utah and Arizona permits are references only to permits that have been applied for but are yet to be issued. There is no assurance that Arizona State Land mineral exploration permits and BLM potassium prospecting permits will be issued or that those issued will be contiguous. All interest in the permits and applications held by American Potash are subject to further obligations under the option agreement described in the June 3, 2009 news release.
This announcement has been prepared under the supervision of Lawrence A. Dick, Ph.D., P.Geo, the Qualified Person for the purposes of NI 43-101 with respect to the technical information in this news release. Mr. Dick is also the President and Chief Executive Officer of Confederation Minerals Ltd.
On behalf of MAGNA RESOURCES LTD.
“Rudy de Jonge ”
Rudy de Jonge
This press release contains forward-looking information regarding managements anticipated completion of the proposed private placement financing and its anticipated use of the proceeds. The forward-looking information contained in this press release is made based on expectations of management as of the date of this press release and, except as required by applicable law, Magna does not undertake any obligation to update publicly or to revise any of the included forward-looking information, whether as a result of new information, future events or otherwise. By its very nature, such forward-looking information requires Magna to make assumptions that may not materialize or that may not be accurate. This forward-looking information is subject to known and unknown risks and uncertainties and other factors, which may cause actual results, levels of activity and achievements to differ materially from those expressed or implied by such information. There is no assurance that Magna will be able to raise some or all of the proposed private placement financing.
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