Davenport Resources Ltd non-executive director (then chairman) Patrick McManus speaks to Proactive Investors about our South Harz Potash Project in central Germany.
South Harz, Germany
Map of licence location
The South Harz Potash District, located in the heart of Germany, was one of the world’s most important Muriate of Potash (MOP) producing regions, with a history of mining going back over 120 years. Prior to the re-unification of Germany in the 1990’s, the former German Democratic Republic (GDR) produced approximately 3.3 million tonnes (Mt) of K2O annually from mines within and around the South Harz Potash District. Historically, both Sylvinite and Carnallitite potash ores have been mined in the South Harz Potash District by conventional underground room and pillar mining. More recently Carnallitite ores are being mined by modern-day solution mining techniques, at a production rate estimated at just over 100,000 tonnes MOP per year. It is Davenport’s belief that targeted and strategic investment in the South Harz Potash District can support modern-day potash production rates similar to those of former times.
Davenport Resources’s South Harz Project portfolio comprises three perpetual potash mining licences, Ebeleben, Mühlhausen-Nohra and Ohmgebirge and two potash exploration licences, Küllstedt and Gräfentonna, covering a total area of approximately 659km². Davenport’s licences surround five former underground potash mines that were closed down after German reunification in the 1990’s. Production from these five mines is estimated to have been 181.7 million tonnes of potash which was produced since the 1890’s.
The three perpetual mining licence areas and the exploration licence area Küllstedt have been extensively explored for potash by the state mining company of the former GDR and a vast database of drillholes and technical studies exists to support the geological model. The Gräfentonna licence was extensively explored for hydrocarbons, and much of the existing exploration data is useful for the evaluation of potash.
At the time of closure in 1991, the Volkenroda mine was scheduled to be extended to the east into the Ebeleben Mining Licence area, and shaft sinking for a new ventilation shaft had begun and was at an advanced stage. Similarly, investigations were well underway to extend the Volkenroda mine to the west, or to establish a new stand-alone mining operation within the Mühlhausen-Nohra Mining Licence area which is now held by Davenport.
Davenport JORC 2012 Resources
Davenport’s three perpetual mining licences, Ebeleben, Mühlhausen-Nohra and Ohmgebirge, are unique and valuable. From 2017 to 2020, Davenport Resources has focused on evaluating the vast archive of exploration data with the aim of defining JORC 2012 compliant resources together with technical and economic studies for each of the areas.
An initial JORC 2012 Inferred resource estimate of 557 million tonnes grading 12.1% K2O at Ebeleben was announced in April 2018. Davenport expanded its resources base in October 2018 when the company announced the Mühlhausen-Keula sub-area Inferred resource of 1.13 billion tonnes grading on average 11.1% K2O. In November 2018, Davenport released details of resource modelling work from its Nohra-Elende Sub-Area which added a further Inferred resource of 1,698 million tonnes grading 9.7% K2O to the mineral inventory. In February 2019 Davenport announced an additional 1.54 billion tonnes of JORC 2012 Inferred resources grading 10.7% K2O from its Küllstedt Exploration Licence. Finally, in December 2019 Davenport Resources released an upgrade to JORC 2012 resources for it Ohmgebirge Mining Licence totalling 325 million tonnes at 13.1% K2O.
Additionally, Davenport’s consultants Micon International Co. Limited, identified a further portion of the Nohra-Elende sub-area as an Exploration Target where the drill spacing was too great to determine an Inferred resource. Details of this exploration target were announced in January 2019 for a target of 638 to 1,162 million tonnes grading at 9.2 – 11.1 % K2O*.
Davenport Resources now controls over 5.25 billion tonnes (grading 10.8% K2O) of JORC Inferred Resource, including 1.85 billion tonnes Sylvinite grading 13.23% K2O. Total contained K2O for the Ebeleben, Mühlhausen-Nohra and Ohmgebirge Mining Licences and the Küllstedt exploration Licence now exceeds 524 million tonnes.
Seam |
Tonnage (Mt) |
K2O (%) |
K2O (MT) |
|---|---|---|---|
| Sylvinite | 324.0 | 15.6 | 50 |
| Carnallitite | 253 | 7.5 | 19 |
| Total Ebeleben | 577 | 12.1 | 69 |
| Sylvinite | 101.0 | 14.2 | 14.0 |
| Carnallitite | 1,597 | 9.4 | 150.0 |
| Total Nohra-Elende | 1,698 | 9.7 | 165.0 |
| Sylvinite | 834 | 12.1 | 101 |
| Carnallitite | 296 | 8.2 | 24 |
| Total Mühlhausen-Keula | 1,130 | 11.1 | 125 |
| Sylvinite | 333 | 13.0 | 43.0 |
| Carnallitite | 1,205 | 10.1 | 122 |
| Total Küllstedt | 1,538 | 10.7 | 165.0 |
| Sylvinite | 261 | 13.9 | 36 |
| Carnallitite | 64 | 9.8 | 6 |
| Total Ohmgebirge | 325 | 13.1 | 43 |
| Total Davenport Sylvinite | 1,592 | 13.1 | 209 |
| Total Davenport Carnallitite | 3,350 | 9.4 | 315 |
Total Davenport South Hartz Resources (Dec 2019) |
5,268 |
10.8 |
524 |
Table 1. Davenport Inferred Resources (JORC 2012) – Ebeleben and Mühlhausen-Nohra Mining Licences (including Mühlhausen-Keula and Nohra-Elende sub-areas, Ohmgebirge Mining Licence and Küllstedt Exploration Licence)
Seam |
JORC Category |
Tonnage (Mt) |
K2O (%) |
K2O (MT) |
|||
|---|---|---|---|---|---|---|---|
Minimum |
Maximum |
Minimum |
Maximum |
Minimum |
Maximum |
||
| Upper Sylvinite | Exploration Target | 179 | 223 | 11.0 | 13.5 | 22 | 27 |
| Carnallitite | Exploration Target | 459 | 939 | 8.5 | 10.5 | 44 | 89 |
Total Nohra-Elende Sub-Area |
Exploration Target (Jan 2019) |
638 |
1,162 |
9.20 |
11.07 |
66 |
117 |
Table 2. Davenport Exploration Target (JORC 2012) – Nohra-Elende sub-area, part of the Mühlhausen-Nohra Mining Licence*
*The potential quantity and grade of the Exploration Target is conceptual in nature, there has been insufficient exploration to estimate a mineral resource and it is uncertain if further exploration will result in the estimation of a mineral resource.
Geological Setting
The project lies within the Thuringian Basin which contains a potash-rich evaporite sequence of Permian age. The potash deposits were formed in the Zechstein Sea, a shallow salty body of water that covered a large area extending from the north of England, to central Poland, and eastern France. The so-called Zechstein Evaporites, which developed at the margins of the Zechstein Sea, have historically been an important source of salts, potassium fertilisers and hydrocarbons in the entire region.
The geology that controls the South Harz Potash seams is the same geological units that contains Sirius Minerals’ Woodsmith Mine and ICL’s Boulby Mine in England and K+S’s potash mines located in the central and western parts of Germany. Due to the extensive mining and exploration history in the area, the geology of the project area and potash mineralisation is very well known. The evaporite sequence containing the potash seams within the South Harz District occur at depths of between 500m and 1,200m below surface. The overlying rocks consist of a marine sequence of sandstones, mudstones, marl, dolomite and siltstones.
The potash mineralisation located throughout the South Harz District is hosted by the Permian Stassfurt Formation. Within the Stassfurt Formation, the Kalifloez Stassfurt unit (z2KSt) contains the majority of the potash seams found throughout the entire area. The potash seams are up to 58 metres thick and appears to be richer in Carnallite potash mineralisation in the north and Sylvite potash mineralisation in the south.
Exploration Potential
Küllstedt Exploration Licence
Past mining and exploration within the Küllstedt exploration licence has included three vertical shafts which operated up to 1924 (excised from the tenement), as well as potash exploration drill holes and hydrocarbon wells that have drilled through the potash formations of interest.
Geological data and assay data for the drill holes have been used to develop a 3D geological model of the potash seam and a JORC Inferred resource (ASX release 19 Feb 2019) covering approximately 44% of the Küllstedt exploration licence area. Previous work completed by Davenport identified that almost all the Küllstedt licence is underlain by potash, and that the area contains a significant Exploration Target (Davenport Resources replacement Prospectus p30, 19 Jan 2017*) which has the potential to add further potash to Davenport’s JORC resource inventory.
Gräfentonna Exploration Licence
Although less geological information is available on the Gräfentonna licence, the stratigraphy is broadly similar to that of the Küllstedt licence, and more importantly the Ebeleben Mining Licence. Based on preliminary data the Gräfentonna Licence shows a sylvinite-dominated potash seam running down the central part of the licence area and a carnallitite-dominated potash seam towards the eastern side of the licence.
A detailed geological review and geological model of the potash seam underlying the Gräfentonna licence using the available drilling and geological information has allowed an Exploration Target to be calculated of between 2,678 and 3,396 million tonnes grading between 4.3% and 25% K2O (ASX release 22 May 2017*).
Licence Area |
JORC Category |
Tonnage (Mt) |
K2O (%) |
K2O (MT) |
|||
|---|---|---|---|---|---|---|---|
Minimum |
Maximum |
Minimum |
Maximum |
Minimum |
Maximum |
||
| Gräfentonna | Exploration Target | 2,678 | 3,396 | 4.3 | 25.0 | 115 | 849 |
Table 3. Davenport Exploration Target (JORC 2012) – Gräfentonna Exploration Licence (May 2017)*
*The potential quantity and grade of the Exploration Target is conceptual in nature, there has been insufficient exploration to estimate a mineral resource and it is uncertain if further exploration will result in the estimation of a mineral resource.
Planned Exploration of Germany
A review of JORC Inferred resources contained within Davenport’s perpetual mining licence areas has highlighted five projects that have the potential size and grade to warrant investigation into new stand-alone potash mines. These stand-alone projects include the entire Ebeleben Mining Licence, which is rich in high grade Sylvinite, the Mühlhausen-Nohra-Elende area, which contains extremely thick Carnallitite and Kieserite, the Mühlhausen-Keula area, extending into the southern portion of Davenport’s Küllstedt Exploration Licence, where the underground geology contains thick potash seams composed of high grade sylvinite together with valuable sulphate minerals, and the entire Ohmgebirge Mining Licence, where remnant resources left in the ground could be accessed quickly from existing infrastructure and for low cost.
Davenport Resources commissioned salt and potash consultancy, K-Utec Salt Technologies based in Sondershausen, within the South Harz district, to conduct preliminary engineering and economic evaluations for three of our five potential projects within our portfolio. The three studies have now been completed demonstrating encouraging and robust projects that are all technically feasible. The studies will enable Davenport to further understand and rank the potential value of projects within its portfolio and enable meaningful discussions to take place with potential project partners.
