First Nation Invests in Potash in Saskatchewan
ANALYSIS – ProspectingJournal.com – Upon returning from my latest site visit and video shoot detailing a partnership for potash in Saskatchewan between Encanto Potash [EPO – TSX.V] and the Muskowekwan First Nation (MFN), I was pleased to see that the relationship was healthy and the company is poised to make the gains I’d read about before the trip. Often we can glean from press releases that a relationship is mutually beneficial, but until you see the two parties interact first hand you can’t be sure. As a former surface land man, I’ve seen plenty of less-than-ideal interactions between landowners and their potential lease holders, but when it came to interviewing EPO’s President and CEO Jim Walchuck and the MFN’s Chief Reginald Bellerose it couldn’t be clearer that the two parties are comfortable and happy to be in business with one another. That said, my biggest lessons from the trip came from learning about the Muskowekwan First Nation.
As our crew set up the cameras for the equipment and measured our light levels, I had a chance to walk around the school that stood as a pillar of hope in the middle of the community. Slogans adorned the hallways aimed at teaching mutual respect, quelling bullying and increasing self-esteem. But when I talked to the elders and to the people who came by to take part in our ProspectingTV shoot, I learned that these slogans might not be enough for the children who will someday be the next group of elders in charge of the community’s stewardship.
What I saw was a community in need of a boost, and a concern for well being that spanned generations. These people weren’t just concerned about their current situation, but for the hopes and dreams of their children and the generations to follow. The elders were genuinely worried about what could be done to break the cycle of despair on the reserve that too often results in either their children moving away to far off communities for work, or staying and giving up hope.
Through developing their reserve’s ample potash resource, the Muskowekwan are poised to receive bountiful gifts from the land, not only in the form of royalties and infrastructure development, but in jobs and a lifted sense of self-esteem. There is plenty of potash in Saskatchewan, and the Muskowekwan sit right in the sweet spot surrounded by numerous producing mines. Given the recent release of Encanto’s Preliminary Economic Assessment (PEA), which includes a plan for solution mining over conventional mining, it seems that the Muskowekwan people will benefit from this partnership for many years.
The PEA was a company milestone for Encanto, as well as for the Muskowekwan people. It outlined a mine life of nearly 56 years, and that’s not including the additional Treaty Land Entitlement (TLE) lands that would add 15,500 acres to the package and could possibly extend the mine life by decades.
Whether or not these additional TLE lands will be designated for development will be announced after October 1, 2011. The vote will take place both on the Home Reserve near Lestock, Saskatchewan, and through mail-in ballots, under the authority of Aboriginal Affairs and Northern Development (AAND). Both Walchuck and Chief Bellerose are confident in the upcoming results, based on responses from preliminary meetings. Based on the responses I received from the people I talked to, the Chief and CEO were on the right track, and the message contained in the PEA should only help the situation.
What the PEA delivered was a message of hope to a people in need of reinforcement. While solution mining lowers the overall manpower requirements, it will likely increase the opportunities for employment by First Nation members, with a roster of 320 full time employees scheduled to be needed. For the MFN this means more work available, while for EPO it means a higher NPV and lower Capex compared to conventional mining.
One significant meeting was with Chad Owen Blind who waited eagerly throughout the day for his chance to weigh in on the potential of the partnership. Chad had worked in other parts of the province from general labour to night security, as well as moonlighting as a semi-pro wrestler thus proving himself more than employable off the reserve. A potash mine would mean that he could work near his home, sleep in his own bed, and be near his own family without going elsewhere to earn an income. There’s plenty of mining related work for potash in Saskatchewan, but for Chad and others like him there’s none currently near home.
For Chad, the Encanto partnership represents a homecoming of sorts, and a vision of what his community could become.
Disclaimer: The host does not currently hold any shares of any of the companies mentioned in the video. However, some members of Cordova Media Inc. which owns ProspectingJournal.com, may or may not have interests in one or more of the companies mentioned at the time of publication. Staff members from the Prospecting Journal reserve the right to acquire interests in any of the companies mentioned after 36 hours have elapsed upon initial publication of this video. Encanto Potash is a sponsor of ProspectingJournal.com.