TIDMSO4

RNS Number : 7341U

Salt Lake Potash Limited

31 July 2020

 
 31 July 2020   AIM/ASX Code: SO4 
 
 
 SALT LAKE POTASH LIMITED 
------------------------- 
 

JUNE 2020 QUARTERLY REPORT

Salt Lake Potash Limited ( SO4 or the Company ) is pleased to present its Quarterly Report for the period ending 30 June 2020. The Company is focussed on rapidly developing the Lake Way SOP Project in Wiluna, Western Australia.

HIGHLIGHTS

On-Lake Construction & Operations

-- Stage 1 & 2 pond networks in operation and precipitating harvest salts.

-- 45km of brine transfer piping installed and site pumping capacity >600L/s to support pond operations.

-- Harvest salt and brine chemistry aligning with model. During the quarter a 277kg bulk sample of harvest salts was taken from the Stage 1 Kainite Ponds, reporting average potassium grades of 7.5%, above assumed average plant feed in the BFS of 6.8%.

-- Trench development recommenced in June with total trench length extended to 48km by the end of the June quarter (from 35km at end March quarter).

-- Paleochannel borefield development commenced with drilling and test pumping of brine extraction bores. Four bores were drilled during the quarter with two test pumped and one test currently underway. Results confirmed the BFS model for both aquifer parameters and brine grade.

Process Plant and Non-Process Infrastructure

-- EPC and EPCM contracts for the construction of the Lake Way processing plant and non-process infrastructure (NPI) were awarded to GR Engineering Services (ASX:GNG).

-- During the quarter the bulk civil earthworks for the process plant and non-process infrastructure were completed.

-- Concrete placement is well progressed with more than 50% of the process plant work complete.

-- Structural steel started arriving on site and erection has commenced post period end.

-- 100 permanent and 160 temporary rooms constructed at the site village with associated infrastructure including Communications, WWTP and RO plant.

-- Project has procured approximately 90% of major vendor packages with all critical vendor contracts executed.

-- Construction of the process plant continues on schedule during the June quarter with practical completion and first SOP production planned for the March quarter 2021.

Corporate & Financial

-- Project debt financing substantially advanced with execution expected imminently.

-- SO4 was granted 'Green Label' certification for debt issued to develop the Lake Way Project.

-- In April 2020 the Company raised A$20m in a placement to existing and new institutional investors.

-- Immediately following period-end the Company raised A$15m via zero-coupon convertible notes, structured as deferred equity.

-- Matthew Bungey appointed to the board of directors.

Upcoming milestones/activity

-- Finalisation of full project funding.

-- Ongoing delivery of major plant components to site.

-- Process plant and non process infrastructure construction ramp up.

-- On-lake Stage 3 pond and trench construction activities ramp up.

-- Paleochannel borefield drilling and pump testing continues.

on-lake operations

Brine extraction: Trenches

Trench development re-commenced during the quarter with total trench length extended to 48km by the end of June (from 35km at end March quarter).

Paleochannel drilling

During the quarter SO4 commenced development of the Lake Way paleochannel, drilling the first four brine abstraction bores into the paleochannel basal sands at pads 8, 17, 18 and 21. Two of the four completed brine abstraction bores have now been test-pumped (Pad 8 and 17) with the third test currently underway (Pad 21).

Drilling is ongoing with the next tranche of bores being at Pads 12, 14 and 23.

Test pumping at pads 8 and 17 was conducted at flow rates ranging from 10-18 l/s and with grades observed during testing ranging from 7,240mg/l to 5,370mg/l.

Table 1 provides a summary of the completed bores (see Appendix C for further detail).

 
 Drill   Bore Name   Depth (m)    Basal sand      Basal             Test pumping     Average Potassium 
  Pad                              intersection    Sand Thickness    Rate (L/s)       Grade During 
                                   (mbgl)          (m)                                Pumping (mg/L) 
 Completed test pumping: 
                                                 ====================  =========== 
                                       99 
                                        - 
   8     LYPBB004       114            111                12                10             5,370 
                                       95 
                                        - 
  17     LYPPB001       113            113                18                18             7,240 
        ==========  ===========  ==============  ====================  =========== 
 Drilled but test pumping 
  not concluded: 
                                       88 
                                        -                                not yet 
  18     LYPBB006      112.5           110                22              tested          6,890* 
        ==========  ===========  ==============  ====================  =========== 
                                       92 
                                        - 
  21     LYPZB002       114            111                19               12*             7,260 
======  ==========  ===========  ==============  ====================  ===========  ================== 
 
 

Note: *Potassium Grade from Bore LYPBB006 is from an airlift sample. Test pumping at bore LYPZB002 is ongoing.

Table 1: June Quarter Paleochannel drill programme summary

Separate monitoring bores were drilled adjacent to the brine abstraction bores at Pads 8 and 17 in both the paleochannel and the overlying paleovalley clays. Importantly, drawdown was observed in the monitoring bores during test pumping. Drawdown in both the basal sand aquifer and overlying clays demonstrates that brine flow is sourced from lateral flow within the basal sand aquifer as well as from downward vertical leakage from the overlying paleovalley clays. This is consistent with modelling assumptions set out in the BFS. In each case drawdown was also observed at more distant monitoring bores - in the case of Pad 8 a drawdown was observed in a monitoring bore on Pad 9 (878 m away), in the case of Pad 17 a drawdown was observed in a monitoring bore on Pad 21 (1.6km away).

By matching the measured drawdown curves with modelled drawdown curves the Company was able to estimate the aquifer parameters and confirm the continuity of the paleochannel.

In summary, the results from the paleochannel drilling campaign have validated SO4's BFS model in terms of the location, continuity and depth of the paleochannel basal sands and brine grades.

Pond operation

The Stage 1 and 2 pond networks both operated at steady state during the June quarter.

Brine chemistry across the pond network continues to align with modelled outcomes. During the quarter, a 277kg bulk sample taken from Kainite Pond 1, Cell C4 was analysed and reported a potassium grade of 7.5%, ahead of the average modelled harvest salt grade in the BFS of 6.8%. In some areas of the Stage 1 harvest cells the salt pavement is now almost 500mm thick.

off-lake operations

Process Plant construction and procurement

Construction of the process plant continued on schedule during the June quarter with practical completion and first SOP production targeted for the March quarter 2021.

In June the Company announced it had awarded the EPC and EPCM contracts for the construction of the Lake Way project to GR Engineering Services (ASX:GNG)(GRES).

The Engineering, Procurement and Construction (EPC) contract encompasses the provision of plant, labour, materials and construction services for the process plant and NPI valued at A$85m. The Engineering, Procurement and Construction Management (EPCM) contract encompasses the provision of services for the engineering, procurement and construction management for areas of the process plant and NPI, valued at A$22m.

As part of the detailed engineering undertaken since completion of the Bankable Feasibility Study (BFS) in October 2019, as well as the negotiated contract risk allocation undertaken with GRES, the Company agreed a revised capital budget of A$264m for the Lake Way Project. The revised number is a A$10m increase to the published BFS capital budget and includes an A$18m contingency allowance.

At the process plant site the Company completed bulk civil earthworks and commenced pouring concrete foundations during the quarter.

Procurement advanced significantly during the quarter with the project now over 90% procured for major packages and all key vendor contracts executed. The largest procurement package, the process plant crystalliser, arrived at site in July, weeks ahead of schedule. Other major plant components including centrifuges, attritioners, flotation cells, sizing screens, thickeners, rotary drier, impact crushers, lump breakers and conveyer belts have all been ordered and will arrive at site during the next two quarters.

Non-process Infrastructure

At Lake Way Village, construction of 100 permanent and 160 temporary rooms were completed.

Bulk civil earthworks were finalised including pad preparation for construction of the power plant, warehouse, workshop, administration and site village, as well as construction of the raw water pond, runoff settlement ponds and site access roads.

Following the quarter-end the Company commenced erecting NPI structural steel at the warehouse/workshop and the process plant site.

At West Creek process water borefield the Company drilled a total of 7 production bores and 2 monitoring bores, that will supply the RO Plant (potable water) and water for the process plant. The production bores have been test-pumped and the steady state operation pumping philosophy finalised.

Approvals

SO4 continued the advancement of the remaining permitting required to support full-scale operations with the submission of the Environmental Review Document (ERD) to the EPA during the quarter. The EPA has determined that the full project scope requires formal assessment with no public review. As part of the EPA submission the Company submitted various surveys, studies, preliminary plans and assessments.

Surveys conducted as part of the EPA submission included:

-- Flora survey

-- Terrestrial Fauna survey

-- Stygofauna survey of bores within the SO4 Lake Way production area

-- Shorebird assessment of Lake Way

-- Aquatic Invertebrates survey

-- Short Range Endemic assessment

Studies conducted as part of the submission included:

-- Visual Impact assessment

-- Ground Water modelling

-- H3 Hydrology Assessment for full project brine extraction

-- Flood study modelling

-- Vadoze Zone modelling

-- Salt Dissipation study

-- Greenhouse Gas study

Preliminary plans and assessments completed as part of the submission included:

-- Mine Closure Plan

-- Stage 3 Environmental Risk Assessment

-- Tecticornia Monitoring and Management Plan

In addition to the EPA submission, the Company continues to seek other project approvals as required. The key approvals granted or advanced during the quarter include:

-- Ministerial consent to use the land under section 18 of the Aboriginal Heritage Act 1972. Land usage includes additional development as needed to meet ongoing project requirements for the off lake non process infrastructure including access and infrastructure corridors, gas pipeline, process water, process plant and village.

-- Ongoing project approvals for the construction of paleo channel bores and the associated infrastructure, received from the Department of Mines, Industry, Regulation and Safety.

-- Submission of the brine extraction licence for on-lake Stage 3 to the Department of Water and Environmental Regulation (the Company has already obtained the necessary water licences to extract process water from the West Creek and Southern borefields).

covid-19 business update

SO4 has continued to monitor Government advice regarding Covid-19 as it has evolved in order to minimise potential impacts. A number of restrictions including interaction with the Wiluna community have now been lifted or eased.

As part of the Company's response to Covid-19, SO4 implemented a number of efficiencies and cost saving measures to ensure the ongoing success of the Project. The temporary reduction to Director fees, executive, management, employee and contractor salaries and fees was lifted effective 1 July 2020.

exploration

The Company is currently progressing resource development work at both Lake Marmion and Lake Ballard as part of a strategic review to determine its next project. During the quarter work focused on the integration of geophysical data and the development of Leapfrog models to assist in identifying future drilling targets within the paleochannel that lies beneath Lakes Ballard and Marmion.

corporate

Debt Financing

In August 2019, SO4 announced that it had mandated Taurus Funds Management (Taurus or the Lenders), to provide up to US$150m project financing for the Lake Way Project.

The Stage 1 Funding Facility (Facility) provided initial access to funding for early construction works at the Lake Way Project and enabled completion of the BFS prior to drawdown of the main Project Development Facility (PDF) . The Facility also funded civil works for the on-lake Stage 2 trenches and evaporation ponds, which with Stage 1 ponds, will provide the initial harvest salt feed for plant commissioning.

The Company has made significant progress in finalising the debt financing that is required to deliver project financial close at Lake Way. Execution of the final agreement is imminent.

Insitutional Placement

On April 17(th) 2020, the Company raised A$20m at a share price of A$0.34, placing 58.8 million new ordinary shares with existing and new institutional investors. As part of the placement SO4 Directors and management subscribed for a total of 3.5 million shares, including 2,250,000 shares by Chairman, Mr Ian Middlemas and 505,883 shares by Managing Director and CEO, Mr Tony Swiericzuk.

Subsequent to the end of the quarter on July 2(nd) 2020, the Company raised a further A$15m through the placement of unsecured convertible notes. The notes were structured as deferred equity with zero coupon and mandatory conversion into equity at the lower of 45c/share or a 5% discount to any future equity raising of at least A$10m. The Convertible Note funds have been placed to a combination of new and existing institutional investors and a new corporate investor, Equatorial Resources Limited (ASX: EQX).

Funds from both capital raisings enabled the Company to continue to deliver the Lake Way Project on schedule, with first SOP production planned in Q1 2021.

R&D Tax Incentive

In July, the Company received an R&D tax incentive payment of A$3.5m from the Australian Taxation Office in respect of its research and development activities in the year ended 30 June 2019.

Green Label Certification

SO4 has been granted 'Green' label certification for debt issued to develop its Lake Way Project. The 'Green' label provides assurance to all stakeholders of the positive environmental contribution of solar brine fertiliser production.

The 'Green' loan label is as set out by the LMA and APLMA green loan principles and eligibility was assessed by DNV GL. As part of the review, Wood Canada Limited conducted a technical assessment of greenhouse gas emissions of SOP production at Lake Way, relative to Mannheim SOP production in other locations. The assessment concluded that a Mannheim process plant of comparable capacity would have 60% higher CO(2) emissions than the Lake Way Project.

Director Appointment

On May 14(th) 2020, the Company announced the appointment of Mr Matthew Bungey to the board. Matthew is a Chemical Engineer with over 20 years experience in Natural Resources, most recently as Managing Director and Head of Mining and Metals with Barclays Investment Bank in London.

For further information or to view a full version of this announcement, including diagrams, please visit https://www.so4.com.au/asx-announcements/ or contact:

 
 Tony Swiericzuk / Richard Knights               Salt Lake Potash Limited                    Tel: +61 8 6559 5800 
 Colin Aaronson / Richard Tonthat / Ben          Grant Thornton UK LLP (Nominated Adviser)   Tel: +44 (0) 20 7383 5100 
 Roberts 
 Derrick Lee / Peter Lynch                       Cenkos Securities plc (Joint Broker)        Tel: +44 (0) 131 220 6939 
 Rupert Fane / Ernest Bell                       Hannam & Partners (Joint Broker)            Tel: +44 (0) 20 7907 8500 
 

This announcement has been authorised for release by the Board of Directors.

The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

Appendix A - Competent Person Statement and Disclaimer

Competent Persons Statement

The information in this announcement that relates to Exploration Results for Lake Way is based on, and fairly represents, information reviewed by Mr Ben Jeuken, who is a member of the Australasian Institute of Mining and Metallurgy and a member of the International Association of Hydrogeologists. Mr Jeuken is employed by Groundwater Science Pty Ltd, an independent consulting company. Mr Jeuken has sufficient experience, which is relevant to the style of mineralisation and type of deposit under consideration and to the activity, which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Mr Jeuken consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

The information in this announcement that relates to Process Testwork Results is extracted from the announcement entitled ' Harvest Salt Results Report Above Modelled Potassium Grades' dated 28 May 2020 . This announcement is available to view on www.so4.com.au. The information in the original ASX Announcement that related to Process Testwork Results was based on, and fairly represents, information provided by Mr Bryn Jones, BAppSc (Chem), MEng (Mining) who is a Fellow of the Australasian Institute of Mining and Metallurgy. Mr Jones is a holder of shares and performance rights in, and is a Director of, Salt Lake Potash Limited. Mr Jones has sufficient experience, which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking, to qualify as a Competent Person as defined in the 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Salt Lake Potash Limited confirms that it is not aware of any new information or data that materially affects the information included in the original market announcement. Salt Lake Potash Limited confirms that the form and context in which the Competent Person's findings are presented have not been materially modified from the original market announcement.

Forward Looking Statements

This announcement may include forward-looking statements. These forward-looking statements are based on Salt Lake Potash Limited's expectations and beliefs concerning future events. Forward looking statements are necessarily subject to risks, uncertainties and other factors, many of which are outside the control of Salt Lake Potash Limited, which could cause actual results to differ materially from such statements. Salt Lake Potash Limited makes no undertaking to subsequently update or revise the forward-looking statements made in this announcement, to reflect the circumstances or events after the date of that announcement.

Appendix B - disclosures in accordance with asx listing rule 5.3

Summary of Mining Tenements

 
 
 Western Australia 
====================  ==============  =============  ==========  ======  ===== 
 Lake Way 
====================  ==============  =============  ==========  ======  ===== 
  Central                 Granted           -         E53/1878    100%    100% 
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  East                    Granted           -         E53/2057    100%    100% 
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  South                   Granted           -         E53/1897    100%    100% 
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  South                   Granted           -         E53/2059    100%    100% 
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  South                   Granted           -         E53/2060    100%    100% 
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  West                  Application         -          L53/208    100%    100% 
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  Central               Application         -         M53/1102    100%    100% 
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  Central               Application         -         M53/1103    100%    100% 
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  Central               Application         -         M53/1104    100%    100% 
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  Central               Application         -         M53/1105    100%    100% 
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  Central               Application         -         M53/1106    100%    100% 
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  Central               Application         -         M53/1107    100%    100% 
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  East                  Application    Application    M53/1109      -     100% 
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  Central                 Granted           -         E53/1862    100%    100% 
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  West                    Granted           -         E53/1863    100%    100% 
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  North                 Application         -         E53/1905    100%    100% 
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  North                 Application         -         E53/1952    100%    100% 
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  North                 Application         -         E53/2049    100%    100% 
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  North                   Granted           -         P53/1642    100%    100% 
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  West                    Granted           -         P53/1643    100%    100% 
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  West                    Granted           -         P53/1645    100%    100% 
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  Central                 Granted           -         P53/1666    100%    100% 
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  Central                 Granted           -         P53/1667    100%    100% 
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  Central                 Granted           -         P53/1668    100%    100% 
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  North                   Granted           -          M53/121    100%    100% 
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  West                    Granted           -          M53/122    100%    100% 
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  West                    Granted           -          M53/123    100%    100% 
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  West                    Granted           -          M53/147    100%    100% 
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  Central                 Granted           -          M53/253    100%    100% 
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  Central                 Granted           -          M53/796    100%    100% 
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  Central                 Granted           -          M53/797    100%    100% 
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  Central                 Granted           -          M53/798    100%    100% 
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  Central                 Granted           -          M53/910    100%    100% 
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  West                    Granted           -          L53/51     100%    100% 
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  West                  Application         -          L53/207    100%    100% 
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  West                    Granted        Granted       L53/211      -     100% 
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  North                   Granted        Granted       L53/212      -     100% 
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                                            - 
  West                  Application          -         L53/214    100%    100% 
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  West                  Application         -          L53/215    100%    100% 
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  North                 Application         -          L53/216    100%    100% 
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  West                  Application         -          L53/217    100%    100% 
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  West                    Granted        Granted       L53/218      -     100% 
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  West                  Application         -          L53/210    100%    100% 
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  West                  Application         -          L53/219    100%    100% 
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  South                        Application             L53/225    100%^   100% 
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  West                         Application             L53/226    100%    100% 
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  West                         Application             L53/228    100%    100% 
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  West                    Granted           -          G53/24     100%    100% 
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  West                  Application         -          G53/25     100%    100% 
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 Lake Wells 
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  Central                 Granted           -         E38/2710    100%    100% 
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  South                   Granted           -         E38/2821    100%    100% 
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  North                   Granted           -         E38/2824    100%    100% 
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  Outer East              Granted           -         E38/3055    100%    100% 
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  Single Block            Granted           -         E38/3056    100%    100% 
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  Outer West              Granted           -         E38/3057    100%    100% 
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  North West              Granted           -         E38/3124    100%    100% 
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  West                    Granted           -          L38/262    100%    100% 
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  East                    Granted           -          L38/263    100%    100% 
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  South West              Granted           -          L38/264    100%    100% 
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  South                   Granted           -          L38/287    100%    100% 
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  South Western           Granted           -         E38/3247    100%    100% 
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  South                   Granted           -         M38/1278    100%    100% 
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  Central               Application         -         E38/3380    100%    100% 
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    North               Application         -         E38/3469    100%    100% 
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    Central             Application         -         E38/3470    100%    100% 
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 Lake Ballard 
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  West                    Granted           -          E29/912    100%    100% 
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  East                    Granted           -          E29/913    100%    100% 
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  North                   Granted           -          E29/948    100%    100% 
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  South                   Granted           -          E29/958    100%    100% 
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  South East              Granted           -         E29/1011    100%    100% 
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  South East              Granted           -         E29/1020    100%    100% 
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  South East              Granted           -         E29/1021    100%    100% 
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  South East              Granted           -         E29/1022    100%    100% 
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  South                   Granted           -         E29/1067    100%    100% 
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  South                   Granted           -         E29/1068    100%    100% 
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  East                    Granted        Granted      E29/1069      -     100% 
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  North                   Granted           -         E29/1070    100%    100% 
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 Lake Irwin 
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  West                    Granted           -         E37/1233    100%    100% 
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  Central                 Granted           -         E39/1892    100%    100% 
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  East                    Granted           -         E38/3087    100%    100% 
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  North                   Granted           -         E37/1261    100%    100% 
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  Central East            Granted           -         E38/3113    100%    100% 
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  South                   Granted           -         E39/1955    100%    100% 
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  North West              Granted           -         E37/1260    100%    100% 
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  South West              Granted           -         E39/1956    100%    100% 
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 Lake Minigwal 
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  West                    Granted           -         E39/1893    100%    100% 
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  East                    Granted           -         E39/1894    100%    100% 
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  Central                 Granted           -         E39/1962    100%    100% 
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  Central East            Granted           -         E39/1963    100%    100% 
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  South                   Granted           -         E39/1964    100%    100% 
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  South West              Granted           -         E39/1965    100%    100% 
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 Lake Marmion 
====================  ==============  =============  ==========  ======  ===== 
  North                   Granted           -         E29/1000    100%    100% 
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  Central                 Granted           -         E29/1001    100%    100% 
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  South                   Granted           -         E29/1002    100%    100% 
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  West                    Granted           -         E29/1005    100%    100% 
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  West                  Application         -         E29/1069    100%    100% 
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 Lake Noondie 
====================  ==============  =============  ==========  ======  ===== 
  North                   Granted           -         E57/1062    100%    100% 
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  Central                 Granted           -         E57/1063    100%    100% 
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  South                   Granted           -         E57/1064    100%    100% 
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  West                    Granted           -         E57/1065    100%    100% 
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  East                    Granted           -          E36/932    100%    100% 
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  Central               Application         -          E36/984    100%    100% 
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  Central               Application         -          E36/985    100%    100% 
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 Lake Barlee 
====================  ==============  =============  ==========  ======  ===== 
  North                   Granted           -          E30/495    100%    100% 
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  Central                 Granted           -          E30/496    100%    100% 
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  South                   Granted           -         E77/2441    100%    100% 
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 Lake Raeside 
====================  ==============  =============  ==========  ======  ===== 
  North                   Granted           -         E37/1305    100%    100% 
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 Lake Austin 
====================  ==============  =============  ==========  ======  ===== 
  North                 Application         -          E21/205    100%    100% 
====================  ==============  =============  ==========  ======  ===== 
  West                  Application         -          E21/206    100%    100% 
====================  ==============  =============  ==========  ======  ===== 
  East                    Granted           -          E58/529    100%    100% 
====================  ==============  =============  ==========  ======  ===== 
  South                   Granted           -          E58/530    100%    100% 
====================  ==============  =============  ==========  ======  ===== 
  South West              Granted           -          E58/531    100%    100% 
====================  ==============  =============  ==========  ======  ===== 
 Lake Moore 
====================  ==============  =============  ==========  ======  ===== 
    Central            Relinquished         -         E59/2344    100%     - 
====================  ==============  =============  ==========  ======  ===== 
 Northern Territory 
====================  ==============  =============  ==========  ======  ===== 
 Lake Lewis 
====================  ==============  =============  ==========  ======  ===== 
  South                   Granted           -         EL 29787    100%    100% 
====================  ==============  =============  ==========  ======  ===== 
  North                   Granted           -         EL 29903    100%    100% 
====================  ==============  =============  ==========  ======  ===== 
 

Related Party Payments

During the quarter ended 30 June 2020, the Company made payments of $21,000 to related parties and their associates. These payments relate to existing remuneration arrangements (executive salaries and superannuation).

Appendix C - Paleochannel drilling Summary

 
                                                                                                                              Constant 
                                                                                                                                rate 
                                                                                                                                test 
                                                 Total                                    Basal                               pumping 
                                                Drilled    Geological     Basal sand      Sand      Airlift     Potassium       flow     Observed 
 Drill                                           Depth        Unit       intersection   Thickness    Yield    Concentration     rate     Drawdown 
  Pad    Bore Name    Easting      Northing       (m)       Screened        (mbgl)         (m)       (L/s)       (mg/L)        (L/s)       (m) 
------  ----------  -----------  ------------  --------  -------------  -------------  ----------  --------  --------------  ---------  --------- 
                                                          Paleochannel 
   8     LYPBB004    251750.856   7028285.591     114      Basal Sand      99 - 111        12        22.6         5,630          10       15.79 
                                                          Paleochannel 
   8     LYPZB004a   251756.889   7028272.859     114      Basal Sand      99 - 111        12         17          5,340                   10.93 
                                                          Paleochannel 
   8     LYPZB004c   251749.212   7028295.219     71          Clay                                                4,600                    n/a 
                                                          Paleochannel 
   8     LYPZB004b   251746.101   7028294.044     47          Clay                                                4,100                    0.05 
                                                          Paleochannel 
   9     LYPZP003a   251082.502   7028856.555     97       Basal Sand      74 - 95         21                     5390 
                                                          Paleochannel 
                                                           Basal Sand 
                                                          Paleochannel 
  17     LYPPB001    239815.477   7040118.794     113      Basal Sand      95 - 113        18         35          7,240         17.7      26.44 
                                                          Paleochannel 
  17     LYPZB001a   239807.198   7040112.502     115      Basal Sand      95 - 113        18         12          7,260                   21.45 
                                                          Paleochannel 
  17     LYPZB001b   239810.761   7040121.82      72          Clay                                                6,890                    6.8 
                                                          Paleochannel 
  18     LYPZB006a   238340.229   7042468.541     112      Basal Sand      88 - 110        22         10          6,960 
                                                          Paleochannel 
  18     LYPZB006b     238341       7042441      112.5     Basal Sand      88 - 110        22         10          6,890 
                                                          Paleochannel 
  18     LYPBB006      238768       7041324       64          Clay                                                6,300 
                                                          Paleochannel 
  21     LYPBB002    238759.272   7041333.307     114      Basal Sand      92 - 111        19         16          7,230 
                                                          Paleochannel 
  21     LYPZB002a   238769.49    7041332.51      108      Basal Sand      92 - 111        19                     7,200 
                                                          Paleochannel 
  21     LYPZB002b   238779.725   7041335.349     68          Clay                                                6,320          12 
------  ----------  -----------  ------------  --------  -------------  -------------  ----------  --------  --------------  ---------  --------- 
 

Note: Drilled depth equates to end of hole and all holes are vertical. LYPBB denotes pumping bore. LYPZB denotes piezometer.

Estimated acquifer parameters

Pumping test data was analysed by calibrating a model of the paleochannel sand aquifer to the water level drawdown data measured at observation bores during the pumping tests. Model calibration was performed by manually varying model parameters until a best match was achieved between predicted and observed water levels.

The following parameters were varied during the estimation process:

-- Horizontal hydraulic conductivity (Kh) and Specific Storage (Ss) of the paleochannel sand; and

   --    Vertical hydraulic conductivity (Kv) and Specific Storage (Ss) of the overlying clay. 

The calibrated parameters for both Pads 8 and 17 are presented in Tables A1 and A2, and the match between predicted and observed water levels are shown in the Figures available in the full version of this announcement .

Table A1: Pad 8 Estimated Aquifer Parameters

 
    Paleochannel Sand         Paleovalley Clay 
 Parameter      Value      Parameter     Value 
-----------  -----------  ----------  ----------- 
  Kh (m/d)       5.5       Kv (m/d)      0.0001 
  Ss (m/m)    1.7x10(-5)   Ss (m/m)    2.8x10(-5) 
 

Table A2: Pad 17 Estimated Aquifer Parameters

 
    Paleochannel Sand         Paleovalley Clay 
 Parameter      Value      Parameter     Value 
-----------  -----------  ----------  ----------- 
  Kh (m/d)       5.9       Kv (m/d)      0.0004 
  Ss (m/m)    1.7x10(-5)   Ss (m/m)    1.1x10(-5) 
 

APPIX D - JORC CODE, 2012 EDITION - TABLE 1

Section 1 - Sampling Techniques and Data

 
 Criteria                     JORC Code explanation                                          Commentary 
 Sampling techniques                                                                         Drill cuttings were 
                               *    Nature and quality of sampling (e.g. cut channels,       sampled every 2m. The mud 
                                    random chips, or specific specialised industry           rotary method used means 
                                    standard measurement tools appropriate to the            that the samples are 
                                    minerals under investigation, such as downhole gamma     only considered 
                                    sondes, or handheld XRF instruments, etc.). These        representative of the 
                                    examples should not be taken as limiting the broad       geology which is 
                                    meaning of sampling.                                     sufficient for the 
                                                                                             purposes of planning 
                                                                                             the construction of the 
                               *    Include reference to measures taken to ensure sample     brine pumping bore in 
                                    presentively and the appropriate calibration of any      this instance. 
                                    measurement tools or systems used. 
                                                                                             A brine sample and 
                                                                                             duplicate were taken from 
                               *    Aspects of the determination of mineralisation that      every bore after 
                                    are Material to the Public Report.                       development. Brine 
                                                                                             samples and 
                                                                                             duplicates were taken 
                               *    In cases where 'industry standard' work has been done,   from the pumping bore at 
                                    this would be relatively simple (e.g. 'reverse           1 hour after pumping 
                                    circulation drilling was used to obtain 1 m samples      commenced, 24 hours after 
                                    from which 3 kg was pulverised to produce a 30 g         pumping commenced and 
                                    charge for fire assay'). In other cases, more            every 24 hours for the 
                                    explanation may be required, such as where there is      remainder of the test 
                                    coarse gold that has inherent sampling problems.         duration. 
                                    Unusual commodities or mineralisation types (e.g. 
                                    submarine nodules) may warrant disclosure of detailed    Samples were taken 
                                    information.                                             manually from a sampling 
                                                                                             valve on the side of the 
                                                                                             pump headworks. Prior 
                                                                                             to taking the sample the 
                                                                                             bottle was rinsed with 
                                                                                             brine from the pumping 
                                                                                             bore. 
 
                                                                                             Samples were analysed for 
                                                                                             K, Mg, Ca, Na, Cl, SO(4) 
                                                                                             , HCO(3) , NO(3) , pH, 
                                                                                             TDS and specific 
                                                                                             gravity. 
 
                                                                                             Test pumping entailed 
                                                                                             pumping from between 80 
                                                                                             and 90m below ground 
                                                                                             level depending on the 
                                                                                             bore (4m above the top of 
                                                                                             the screens) using a 
                                                                                             submersible electric 
                                                                                             pump. 
 
                                                                                             Water levels in the 
                                                                                             pumping bore and 
                                                                                             monitoring bores were 
                                                                                             measured manually and by 
                                                                                             pressure 
                                                                                             transducers with 
                                                                                             barometric pressure and 
                                                                                             brine density correction. 
                             -------------------------------------------------------------  -------------------------- 
 Drilling techniques                                                                         Mud rotary drilling was 
                                *    Drill type (e.g. core, reverse circulation, open-hole   used in all cases. The 
                                     hammer, rotary air blast, auger, Bangka, sonic, etc.)   pumping bores at Pads 8, 
                                     and details (e.g. core diameter, triple or standard     17, 21 and 18 were 
                                     tube, depth of diamond tails, face-sampling bit or      drilled to 113m, 114m, 
                                     other type, whether core is oriented and if so, by      114m and 112.5m 
                                     what method, etc.).                                     respectivly at 15" 
                                                                                             diameter and completed 
                                                                                             with 10" 
                                                                                             PVC casing and wire wrap 
                                                                                             screens, 18m of screen 
                                                                                             was placed in the Pad 18 
                                                                                             bore from 94m to 
                                                                                             112m, Pad 17 bore from 
                                                                                             94.5mbgl to 112.5mbgl and 
                                                                                             Pad 21 bore from 93 - 
                                                                                             111mbgl, at Pad 18 
                                                                                             the pumping bore was 
                                                                                             completed with 24m of 
                                                                                             screen from 88m - 112m. 
 
                                                                                             In all pumping bores the 
                                                                                             annulus was gravel packed 
                                                                                             with 1.6 - 3.2mm washed 
                                                                                             gravel from total 
                                                                                             depth to 10m above the 
                                                                                             screens then a 10m cement 
                                                                                             plug was installed from 
                                                                                             and the bore backfilled 
                                                                                             with gravel to surface 
                                                                                             where a 6m sanitary 
                                                                                             cement seal was emplaced. 
 
                                                                                             The deep monitoring bore 
                                                                                             Pad 17 was drilled to 
                                                                                             115m, at a diameter of 9 
                                                                                             7/8" and cased with 
                                                                                             6" slotted at the base 
                                                                                             and blank PVC, the bore 
                                                                                             was gravel packed to the 
                                                                                             surface using 1.6 
                                                                                             - 3.2mm washed gravel. A 
                                                                                             6m sanitary cement seal 
                                                                                             was emplaced at the 
                                                                                             surface. 
 
                                                                                             The deep monitoring bores 
                                                                                             at Pads 8, and 18 were 
                                                                                             drilled to 114m and 112m 
                                                                                             respectively at 
                                                                                             a diameter of 9 7/8" and 
                                                                                             cased with 6" slotted at 
                                                                                             the base and blank PVC, 
                                                                                             the bores were gravel 
                                                                                             packed using 1.6 - 3.2mm 
                                                                                             washed gravel to 10m 
                                                                                             above the screen and a 
                                                                                             10m cement plug installed 
                                                                                             prior to being gravel 
                                                                                             packed to surfaece. A 6m 
                                                                                             sanitary cement seal was 
                                                                                             emplaced at the surface. 
 
                                                                                             The deep monitoring bore 
                                                                                             at Pad 21 was drilled to 
                                                                                             108m at a diameter of 6" 
                                                                                             and cased with 
                                                                                             50mm slotted at the base 
                                                                                             and blank PVC, the bore 
                                                                                             was gravel packed using 
                                                                                             1.6 - 3.2mm washed 
                                                                                             gravel to 10m above the 
                                                                                             screen and a 10m cement 
                                                                                             plug installed prior to 
                                                                                             being gravel packed 
                                                                                             to surface. A 6m sanitary 
                                                                                             cement seal was emplaced 
                                                                                             at the surface. 
 
                                                                                             The clay monitoring bores 
                                                                                             were all drilled at a 
                                                                                             diameter of 6" and cased 
                                                                                             with 6m of slotted 
                                                                                             50mm PVC at the base and 
                                                                                             blank 50mm PVC to the 
                                                                                             surface. The bores were 
                                                                                             gravel packed with 
                                                                                             1.6 - 3.2mm washed gravel 
                                                                                             and a neat 10m cement 
                                                                                             seal with 5% bentonite 
                                                                                             was installed via tremmie 
                                                                                             5m above the 6m slotted 
                                                                                             PVC section. A 6m 
                                                                                             sanitary cement seal was 
                                                                                             emplaced at the surface 
                                                                                             in all cases. 
 
                                                                                             Two clay bores were 
                                                                                             installed at Pad 8 to 
                                                                                             depth of 70m and 50m 
                                                                                             respectively, One clay 
                                                                                             bore 
                                                                                             was installed at Pad 17 
                                                                                             to a depth of 72m, one at 
                                                                                             Pad 21 to 68m and one at 
                                                                                             18 to 64m. 
 
                                                                                             All bores were developed 
                                                                                             using airlift techniques 
                                                                                             including surging until 
                                                                                             the discharge was 
                                                                                             clear of drill muds and 
                                                                                             sand . 
                             -------------------------------------------------------------  -------------------------- 
 Drill sample recovery                                                                       Drill cutting were 
                                *    Method of recording and assessing core and chip         collected at the top of 
                                     sample recoveries and results assessed.                 the hole using a sieve 
                                                                                             every 2m. Chip trays were 
                                                                                             also completed for future 
                                *    Measures taken to maximise sample recovery and ensure   reference. 
                                     representative nature of the samples. 
                                                                                             The sample provides an 
                                                                                             indication of the 
                                *    Whether a relationship exists between sample recovery   lithology only. There is 
                                     and grade and whether sample bias may have occurred     not a relationship 
                                     due to preferential loss/gain of fine/coarse            between 
                                     material.                                               the lithology and brine 
                                                                                             grade. 
 
                                                                                             Flow and grade cannot be 
                                                                                             sampled during drilling 
                                                                                             when the mud rotary 
                                                                                             method is used. 
                             -------------------------------------------------------------  -------------------------- 
 Logging                                                                                     The geological logging is 
                                *    Whether core and chip samples have been geologically    sufficient for the 
                                     and geotechnically logged to a level of detail to       purposes of identifying 
                                     support appropriate Mineral Resource estimation,        variations in sand/ clay 
                                     mining studies and metallurgical studies.               and silt fraction within 
                                                                                             the paleochannel 
                                                                                             lithology. 
                                *    Whether logging is qualitative or quantitative in 
                                     nature. Core (or costean, channel, etc.) photography.   For a brine abstraction 
                                                                                             project, the key 
                                                                                             parameters are the 
                                *    The total length and percentage of the relevant         hydraulic conductivity 
                                     intersections logged.                                   and storativity 
                                                                                             of the host rock, which 
                                                                                             will be determined during 
                                                                                             test pumping of the 
                                                                                             bores. 
 
                                                                                             The logging is 
                                                                                             qualitative. 
 
                                                                                             The entire bore depth was 
                                                                                             logged in every case. 
                             -------------------------------------------------------------  -------------------------- 
 Sub-sampling techniques                                                                     Not applicable, mud 
 and sample preparation         *    If core, whether cut or sawn and whether quarter,       rotary drilling. 
                                     half or all core taken. 
                                                                                             Not applicable, cutting 
                                                                                             sampled at the borehead 
                                *    If non-core, whether riffled, tube sampled, rotary      only. 
                                     split, etc. and whether sampled wet or dry. 
                                                                                             The brine samples were 
                                                                                             taken after airlift 
                                *    For all sample types, the nature, quality and           development when each 
                                     appropriateness of the sample preparation technique.    bore was clear of 
                                                                                             drilling 
                                                                                             mud and residual sand. 
                                *    Quality control procedures adopted for all 
                                     sub-sampling stages to maximise representivity of       Brine samples and 
                                     samples.                                                duplicates were taken 
                                                                                             during the test pumping 
                                                                                             at approximately 11am 
                                *    Measures taken to ensure that the sampling is           each 
                                     representative of the insitu material collected,        day of the test pump in 
                                     including for instance results for field                order to identify any 
                                     duplicate/second-half sampling.                         variation in brine grade 
                                                                                             during the test pump 
                                                                                             duration. 
                                *    Whether sample sizes are appropriate to the grain 
                                     size of the material being sampled.                     All the samples taken 
                                                                                             were incorporated into a 
                                                                                             rigorous QA / QC program 
                                                                                             in which Standards 
                                                                                             and Duplicates were 
                                                                                             taken. The samples were 
                                                                                             taken in sterile plastic 
                                                                                             bottles of 125ml or 250ml 
                                                                                             capacity. The samples 
                                                                                             were labelled with the 
                                                                                             alphanumeric code Y20001, 
                                                                                             Y80002 ...etc. 
                             -------------------------------------------------------------  -------------------------- 
 Quality of assay data and                                                                   The brine samples were 
 laboratory tests               *    The nature, quality and appropriateness of the          sent to Bureau Veritas 
                                     assaying and laboratory procedures used and whether     Laboratories in Perth, WA 
                                     the technique is considered partial or total.           with the duplicates 
                                                                                             being held by SO4. Every 
                                                                                             10th duplicate was sent 
                                *    For geophysical tools, spectrometers, handheld XRF      to Intertek, an alternate 
                                     instruments, etc., the parameters used in determining   laboratory for 
                                     the analysis including instrument make and model,       comparison purposes. 
                                     reading times, calibrations factors applied and their 
                                     derivation, etc.                                        No analysis was 
                                                                                             undertaken with 
                                                                                             geophysical tools. 
                                *    Nature of quality control procedures adopted (e.g. 
                                     standards, blanks, duplicates, external laboratory      QA/ QC procedures are 
                                     checks) and whether acceptable levels of accuracy       considered acceptable for 
                                     (i.e. lack of bias) and precision have been             this type exploration and 
                                     established.                                            sampling. 
 
                                                                                             Samples and their 
                                                                                             duplicates have been 
                                                                                             compared for their 
                                                                                             relative difference form 
                                                                                             the mean 
                                                                                             and the individual charge 
                                                                                             balance. 
                             -------------------------------------------------------------  -------------------------- 
 Verification of sampling                                                                    Not applicable for brine 
 and assaying                   *    The verification of significant intersections by        sampling. 
                                     either independent or alternative company personnel. 
                                                                                             Not applicable, however 
                                                                                             monitoring bores have 
                                *    The use of twinned holes.                               been drilled to measure 
                                                                                             changes in water levels 
                                                                                             during test pumping. 
                                *    Documentation of primary data, data entry procedures, 
                                     data verification, data storage (physical and           All sampling and assaying 
                                     electronic) protocols.                                  is well documented and 
                                                                                             contained on SO4's 
                                                                                             internal database. 
                                *    Discuss any adjustment to assay data. 
                                                                                             No adjustments have been 
                                                                                             made to assay data. 
                             -------------------------------------------------------------  -------------------------- 
 Location of data points                                                                     All bore locations and 
                                *    Accuracy and quality of surveys used to locate drill    heights have been 
                                     holes (collar and down-hole surveys), trenches, mine    surveyed by a qualified 
                                     workings and other locations used in Mineral Resource   surveyor, the coordinates 
                                     estimation.                                             are considered accurate 
                                                                                             to +/- 20mm. The surveyed 
                                                                                             heights was measured at 
                                *    Specification of the grid system used.                  the ground surface 
                                                                                             and at the top of casing 
                                                                                             and are considred 
                                *    Quality and adequacy of topographic control.            accurate to +/1 50mm, 
                                                                                             these variations are 
                                                                                             considered 
                                                                                             sufficient for this 
                                                                                             application. 
 
                                                                                             The grid system is the 
                                                                                             Australian National Grid 
                                                                                             Zone MGA 51 (GDA 94). 
 
                                                                                             There is no specific 
                                                                                             topographic control as 
                                                                                             the depth of the hole is 
                                                                                             determined by the 
                                                                                             intersection 
                                                                                             of the target horizon and 
                                                                                             the end of the hole by 
                                                                                             the basement contact. 
                             -------------------------------------------------------------  -------------------------- 
 Data spacing and                                                                            The results provided 
 distribution                   *    Data spacing for reporting of Exploration Results.      represent a single point 
                                                                                             at each bore. 
 
                                *    Whether the data spacing and distribution is            Sample compositing not 
                                     sufficient to establish the degree of geological and    applicable . 
                                     grade continuity appropriate for the Mineral Resource 
                                     and Ore Reserve estimation procedure(s) and 
                                     classifications applied. 
 
 
                                *    Whether sample compositing has been applied. 
                             -------------------------------------------------------------  -------------------------- 
 Orientation of data in                                                                      The target aquifers are 
 relation to geological         *    Whether the orientation of sampling achieves unbiased   contained within 
 structure                           sampling of possible structures and the extent to       paleovalleys incised into 
                                     which this is known, considering the deposit type.      the granitic or 
                                                                                             greenstone 
                                                                                             basement. There are no 
                                *    If the relationship between the drilling orientation    structural controls that 
                                     and the orientation of key mineralised structures is    impact brine flow within 
                                     considered to have introduced a sampling bias, this     the basal sand aquifer. 
                                     should be assessed and reported if material. 
                                                                                             Geological influence on 
                                                                                             the brine is limited to 
                                                                                             the aquifer parameters of 
                                                                                             the host rock, namely 
                                                                                             the hydraulic 
                                                                                             conductivity, total 
                                                                                             porosity and storativity. 
                             -------------------------------------------------------------  -------------------------- 
 Sample security                                                                             SO4 field hydrogeologists 
                                *    The measures taken to ensure sample security.           were responsible for 
                                                                                             collecting, labelling and 
                                                                                             recording brine samples 
                                                                                             prior to shipping to the 
                                                                                             BV lab and the SO4 
                                                                                             offices in Perth. The 
                                                                                             security measures for the 
                                                                                             material and type of 
                                                                                             sampling at hand was 
                                                                                             appropriate. 
                             -------------------------------------------------------------  -------------------------- 
 Audits or reviews                                                                           No audits or reviews of 
                                *    The results of any audits or reviews of sampling        sampling techniques and 
                                     techniques and data.                                    data have been 
                                                                                             undertaken. 
                             -------------------------------------------------------------  -------------------------- 
 

Section 2 - Reporting of Exploration Results

 
          Criteria                               JORC Code explanation                      Commentary 
 Mineral tenement and land                                                                  Bore Pads 17, 21 and 8 are 
 tenure status                  *    Type, reference name/number, location and ownership    on E53/1878. Bore Pad 18 
                                     including agreements or material issues with third     is on E53/2057. 
                                     parties such as joint ventures, partnerships, 
                                     overriding royalties, native title interests,          All tenure is granted to 
                                     historical sites, wilderness or national park and      Piper Preston Pty Ltd, a 
                                     environmental settings.                                wholly owned subsidiary of 
                                                                                            Salt Lake Potash 
                                                                                            Limited. 
                                *    The security of the tenure held at the time of 
                                     reporting along with any known impediments to 
                                     obtaining a licence to operate in the area. 
                             ------------------------------------------------------------  --------------------------- 
 Exploration done by other                                                                  There has been significant 
 parties                        *    Acknowledgment and appraisal of exploration by other   mineral exploration on and 
                                     parties.                                               around Lake Way. The 
                                                                                            primary source 
                                                                                            for the information is the 
                                                                                            publicly available Western 
                                                                                            Australian Mineral 
                                                                                            Exploration (WAMEX) 
                                                                                            report data base. 
 
                                                                                            Some bores drilled by WMC 
                                                                                            in 1992 for the Mt Keith 
                                                                                            mine water supply have 
                                                                                            proved useful in 
                                                                                            determining paleochannel 
                                                                                            grade and aquifer 
                                                                                            parameters. 
 
                                                                                            The data has been shown to 
                                                                                            be useful in the 
                                                                                            determination of the top 
                                                                                            of the paleochannel basal 
                                                                                            sand and for the 
                                                                                            calibration of the passive 
                                                                                            seismic data. 
                             ------------------------------------------------------------  --------------------------- 
 Geology                                                                                    The deposit is a 
                                *    Deposit type, geological setting and style of          paleochannel brine deposit 
                                     mineralisation.                                        lying beneath the eastern 
                                                                                            shore of Lake Way. 
 
                                                                                            The lake and paleochannel 
                                                                                            setting is typical of a 
                                                                                            Western Australian 
                                                                                            palaeovalley environment. 
                                                                                            Ancient hydrological 
                                                                                            systems have incised 
                                                                                            palaeovalleys into 
                                                                                            Archaean basement rocks, 
                                                                                            which 
                                                                                            were then infilled by 
                                                                                            Tertiary-aged sediments 
                                                                                            typically comprising a 
                                                                                            coarse-grained fluvial 
                                                                                            basal sand overlaid by 
                                                                                            palaeovalley clay with 
                                                                                            some coarser grained 
                                                                                            interbeds. The clay is 
                                                                                            overlaid by recent 
                                                                                            Cainozoic material 
                                                                                            including lacustrine 
                                                                                            sediment, calcrete, 
                                                                                            evaporite and 
                                                                                            aeolian deposits. 
                             ------------------------------------------------------------  --------------------------- 
 Drill hole Information                                                                     Bore coordinates and 
                                *    A summary of all information material to the           elevations were located by 
                                     understanding of the exploration results including a   surveyor which is 
                                     tabulation of the following information for all        sufficient for this type 
                                     Material drill holes:                                  of exploration activity. 
 
                                                                                            All bores are vertical. 
                                *    easting and northing of the drill hole collar 
                                                                                            Total drilled depths, 
                                                                                            basal sand interceptions 
                                *    elevation or RL (Reduced Level - elevation above sea   and screened intervals are 
                                     level in metres) of the drill hole collar              included in a table 
                                                                                            in Appendix C for the 
                                                                                            abstraction bores and deep 
                                *    dip and azimuth of the hole                            monitoring bores. The 
                                                                                            screened interval is 
                                                                                            also stated for the clay 
                                *    downhole length and interception depth                 monitoring bores. 
 
                                                                                            No information related to 
                                *    hole length.                                           the drilling and test 
                                                                                            pumping of the bores has 
                                                                                            been excluded. 
                                *    If the exclusion of this information is justified on 
                                     the basis that the information is not Material and 
                                     this exclusion does not detract from the 
                                     understanding of the report, the Competent Person 
                                     should clearly explain why this is the case. 
                             ------------------------------------------------------------  --------------------------- 
 Data aggregation methods                                                                   No cut off grade is 
                               *    In reporting Exploration Results, weighting averaging   stated. 
                                    techniques, maximum and/or minimum grade truncations 
                                    (e.g. cutting of high grades) and cut-off grades are    No data aggregation has 
                                    usually Material and should be stated.                  been undertaken. 
 
 
                               *    Where aggregate intercepts incorporate short lengths 
                                    of high grade results and longer lengths of low grade 
                                    results, the procedure used for such aggregation 
                                    should be stated and some typical examples of such 
                                    aggregations should be shown in detail. 
 
 
                               *    The assumptions used for any reporting of metal 
                                    equivalent values should be clearly stated. 
                             ------------------------------------------------------------  --------------------------- 
 Relationship between                                                                       The chemical analysis from 
 mineralisation widths and     *    These relationships are particularly important in the   the test pumping has shown 
 intercept lengths                  reporting of Exploration Results.                       the that the brine 
                                                                                            resource is consistent 
                                                                                            and continuous within the 
                               *    If the geometry of the mineralisation with respect to   section of paleochannel 
                                    the drill hole angle is known, its nature should be     between Pads 18 and 21 and 
                                    reported.                                               between Pads 
                                                                                            8 and historic bore 3_4. 
                                                                                            The unit is flat lying and 
                               *    If it is not known and only the downhole lengths are    the intersected thickness 
                                    reported, there should be a clear statement to this     of the basal 
                                    effect (e.g. 'down hole length, true width not          sands is equivalent to the 
                                    known').                                                vertical depth and the 
                                                                                            thickness of 
                                                                                            mineralisation. 
                             ------------------------------------------------------------  --------------------------- 
 Diagrams                                                                                   All location maps are 
                                *    Appropriate maps and sections (with scales) and        contained within the body 
                                     tabulations of intercepts should be included for any   of the ASX version of this 
                                     significant discovery being reported These should      report, in this 
                                     include, but not be limited to a plan view of drill    instance no sections are 
                                     hole collar locations and appropriate sectional        provided although a 
                                     views.                                                 typical cross section of 
                                                                                            the paleochannel has 
                                                                                            been previously reported. 
                                                                                            The intercept of the basal 
                                                                                            sands has been provided in 
                                                                                            the table 
                                                                                            contained within Appendix 
                                                                                            C. 
                             ------------------------------------------------------------  --------------------------- 
 Balanced reporting                                                                             A summary of the brine 
                                *    Where comprehensive reporting of all Exploration           grade results is 
                                     Results is not practicable, representative reporting       included in the report 
                                     of both low and high grades and/or widths should be        and in Appendix C. 
                                     practiced to avoid misleading reporting of 
                                     Exploration Results. 
                             ------------------------------------------------------------  --------------------------- 
 Other substantive                                                                          All material exploration 
 exploration data              *    Other exploration data, if meaningful and material,     data has been reported. 
                                    should be reported including (but not limited to): 
                                    geological observations; geophysical survey results; 
                                    geochemical survey results; bulk samples - size and 
                                    method of treatment; metallurgical test results; bulk 
                                    density, groundwater, geotechnical and rock 
                                    characteristics; potential deleterious or 
                                    contaminating substances. 
                             ------------------------------------------------------------  --------------------------- 
 Further work                                                                                          The drilling 
                                *    The nature and scale of planned further work (e.g.                programme is 
                                     tests for lateral extensions or depth extensions or               ongoing with 
                                     large-scale step-out drilling).                                   Pads at 
                                                                                                       locations 12, 
                                                                                                       14 and 23 
                                *    Diagrams clearly highlighting the areas of possible               planned to be 
                                     extensions, including the main geological                         drilled 
                                     interpretations and future drilling areas, provided               in the next 
                                     this information is not commercially sensitive.                   quarter as well 
                                                                                                       as the 
                                                                                                       commencement of 
                                                                                                       onlake deep 
                                                                                                       drilling, the 
                                                                                                       locations for 
                                                                                                       the on lake 
                                                                                                       bores is still 
                                                                                                       being 
                                                                                                       determined. 
 
                                                                                                       Once drilled 
                                                                                                       all pumping 
                                                                                                       bores will be 
                                                                                                       test pumped. 
 
                                                                                                       All approved 
                                                                                                       off lake 
                                                                                                       locations are 
                                                                                                       shown on maps 
                                                                                                       included in the 
                                                                                                       report. 
                             ------------------------------------------------------------  --------------------------- 
 

APPIX E - APPIX 5B

Appendix 5B

Mining exploration entity or oil and gas exploration entity

quarterly cash flow report

 
 Name of entity 
---------------------------------------------------------------------------------------------- 
 Salt Lake Potash Limited 
 ABN                                                       Quarter ended ("current quarter") 
---------------------------------------------------       ------------------------------------ 
 98 117 085 748                                            30 June 2020 
                                                          ------------------------------------ 
 Consolidated statement of cash                             Current quarter     Year to date 
  flows                                                                          (12 months) 
                                                                 $A'000             $A'000 
                                                          ------------------ 
               1.   Cash flows from operating 
                     activities 
 1.1                Receipts from customers                                -                 - 
 1.2                Payments for 
                    (a) exploration & evaluation                     (2,170)          (32,559) 
                    (b) development                                        -                 - 
                    (c) production                                         -                 - 
                    (d) staff costs                                  (1,147)           (7,297) 
                    (e) administration and corporate 
                     costs                                             (113)           (1,971) 
 1.3                Dividends received (see note                           -                 - 
                     3) 
 1.4                Interest received                                     19               167 
                    Interest and other costs of 
 1.5                 finance paid                                          -             (980) 
 1.6                Income taxes paid                                      -                 - 
                    Government grants and tax 
 1.7                 incentives                                          170             1,082 
                         Other (provide details if 
 1.8                      material) 
                           - Business Development                      (520)           (3,043) 
                           - Security Deposits                             -              (76) 
                                                          ------------------  ---------------- 
                    Net cash from / (used in) 
 1.9                 operating activities                            (3,761)          (44,677) 
-----------------  -------------------------------------  ------------------  ---------------- 
 
 2.                      Cash flows from investing 
                          activities 
                         Payments to acquire or for: 
                    (a) entities                                           -                 - 
                    (b) tenements                                          -          (10,000) 
                    (c) property, plant and equipment                  (781)           (2,410) 
                    (d) exploration & evaluation                           -                 - 
                    (e) investments                                        -                 - 
                    (f) other non-current assets 
                     - Mine Properties in development               (24,875)          (67,192) 
 2.2                     Proceeds from the disposal 
                          of: 
                    (a) entities                                           -                 - 
                    (b) tenements                                          -                 - 
                    (c) property, plant and equipment                      -                35 
                    (d) investments                                        -                 - 
                    (e) other non-current assets                           -                 - 
 2.3                Cash flows from loans to other                         -                 - 
                     entities 
 2.4                Dividends received (see note                           -                 - 
                     3) 
 2.5                Other (provide details if                              -                 - 
                     material) 
                                                          ------------------  ---------------- 
                    Net cash from / (used in) 
 2.6                 investing activities                           (25,656)          (79,567) 
-----------------  -------------------------------------  ------------------  ---------------- 
 
 3.                 Cash flows from financing 
                     activities 
                    Proceeds from issues of equity 
                     securities (excluding convertible 
 3.1                 debt securities)                                 20,000            50,891 
 3.2                Proceeds from issue of convertible                     -                 - 
                     debt securities 
 3.3                Proceeds from exercise of                              -                 - 
                     options 
                    Transaction costs related 
                     to issues of equity securities 
 3.4                 or convertible debt securities                    (800)           (1,782) 
 3.5                Proceeds from borrowings                               -            66,600 
 3.6                Repayment of borrowings                            (117)             (355) 
                    Transaction costs related 
 3.7                 to loans and borrowings                               -           (3,080) 
 3.8                Dividends paid                                         -                 - 
 3.9                Other (provide details if                              -                 - 
                     material) 
                                                          ------------------  ---------------- 
                    Net cash from / (used in) 
 3.10                financing activities                             19,083           112,274 
-----------------  -------------------------------------  ------------------  ---------------- 
 
 4.                 Net increase / (decrease) 
                     in cash and cash equivalents 
                     for the period 
                    Cash and cash equivalents 
 4.1                 at beginning of period                           17,310            19,304 
                    Net cash from / (used in) 
                     operating activities (item 
 4.2                 1.9 above)                                      (3,761)          (44,677) 
                    Net cash from / (used in) 
                     investing activities (item 
 4.3                 2.6 above)                                     (25,656)          (79,567) 
                    Net cash from / (used in) 
                     financing activities (item 
 4.4                 3.10 above)                                      19,083           112,274 
                    Effect of movement in exchange 
 4.5                 rates on cash held                                   27             (331) 
                    Cash and cash equivalents 
 4.6                 at end of period                                  7,003             7,003 
 
 
 
               5.   Reconciliation of cash and           Current quarter   Previous quarter 
                     cash equivalents                         $A'000            $A'000 
                     at the end of the quarter 
                     (as shown in the consolidated 
                     statement of cash flows) to 
                     the related items in the accounts 
 5.1                Bank balances                                  6,953             17,310 
 5.2                Call deposits                                     50                  - 
 5.3                Bank overdrafts                                    -                  - 
 5.4                Other (provide details)                            -                  - 
                                                        ----------------  ----------------- 
                    Cash and cash equivalents 
                     at end of quarter (should 
 5.5                 equal item 4.6 above)                         7,003             17,310 
-----------------  -----------------------------------  ----------------  ----------------- 
 
 
               6.    Payments to related parties of the entity    Current quarter 
                      and their associates                             $A'000 
                     Aggregate amount of payments to related 
                      parties and their associates included in 
 6.1                  item 1                                                 (21) 
                                                                 ---------------- 
 6.2                 Aggregate amount of payments to related                    - 
                      parties and their associates included in 
                      item 2 
                                                                 ---------------- 
 Note: if any amounts are shown in items 6.1 or 6.2, your quarterly 
  activity report must include a description of, and an explanation 
  for, such payments. 
 
 
               7.   Financing facilities                    Total facility      Amount drawn 
                     Note: the term "facility'             amount at quarter    at quarter end 
                     includes all forms of financing              end               $A'000 
                     arrangements available to                  $A'000 
                     the entity. Add notes as necessary 
                     for an understanding of the 
                     sources of finance available 
                     to the entity. 
 7.1                Loan facilities                                   65,569            65,569 
                                                         -------------------  ---------------- 
 7.2                Credit standby arrangements                            -                 - 
                                                         -------------------  ---------------- 
 7.3                Other (please specify)                                 -                 - 
                                                         -------------------  ---------------- 
 7.4                Total financing facilities                        65,569            65,569 
                                                         -------------------  ---------------- 
 
 7.5                Unused financing facilities available at                                 - 
                     quarter end 
                                                                              ---------------- 
 7.6                Include in the box below a description of each facility 
                     above, including the lender, interest rate, maturity date 
                     and whether it is secured or unsecured. If any additional 
                     financing facilities have been entered into or are proposed 
                     to be entered into after quarter end, include a note providing 
                     details of those facilities as well. 
-----------------  --------------------------------------------------------------------------- 
                     The Company has mandated Taurus Funds Management (as manager 
                      of the Taurus Mining Finance Fund L.P., Taurus Mining 
                      Finance Annex Fund L.P. and Taurus Mining Finance Fund 
                      No. 2 L.P.) to provide up to US$150m project financing 
                      for the Lake Way Project. 
                      The Stage 1 Facility was extended from US$30 million to 
                      US$45 million as announced to the market on 6 December 
                      2020 and has been fully drawn down. The facility is secured 
                      and interest is payable at 9.75% pa. 
                      The Project Development Facility (PDF) will be used to 
                      refinancing the Stage 1 Facility and for project development 
                      and working capital associated with the development of 
                      the Lake Way Project. Draw down of the PDF will be subject 
                      to a number of Conditions Precedent, The PDF will be secured 
                      and interest will be payable at 9.00% pa. 
                      As the loan is denominated in USD, the facility amount 
                      and amount drawn down has been converted at an FX rate 
                      of $0.6863 USD/AUD, being the FX cross rate at 30 June 
                      2020. 
----------------- 
 
 
               8.   Estimated cash available for future operating              $A'000 
                     activities 
                    Net cash from / (used in) operating activities 
 8.1                 (item 1.9)                                                (3,761) 
 8.2                (Payments for exploration & evaluation classified                - 
                     as investing activities) (item 2.1(d)) 
 8.3                Total relevant outgoings (item 8.1 + item                  (3,761) 
                     8.2) 
 8.4                Cash and cash equivalents at quarter end                     7,003 
                     (item 4.6) 
 8.5                Unused finance facilities available at quarter                   - 
                     end (item 7.5) 
                                                                              -------- 
 8.6                Total available funding (item 8.4 + item                     7,003 
                     8.5) 
                                                                              -------- 
 
                    Estimated quarters of funding available 
 8.7                 (item 8.6 divided by item 8.3)                               1.86 
                                                                              -------- 
                    Note: if the entity has reported positive relevant outgoings 
                     (ie a net cash inflow) in item 8.3, answer item 8.7 as 
                     "N/A". Otherwise, a figure for the estimated quarters 
                     of funding available must be included in item 8.7. 
 8.8                If item 8.7 is less than 2 quarters, please provide answers 
                     to the following questions: 
                    8.8.1 Does the entity expect that it will continue to 
                     have the current level of net operating cash flows for 
                     the time being and, if not, why not? 
                   ------------------------------------------------------------------- 
                    Answer: The Company expects to have similar levels of 
                     total net operating and investing cash flows for the current 
                     quarter. 
                   ------------------------------------------------------------------- 
                    8.8.2 Has the entity taken any steps, or does it propose 
                     to take any steps, to raise further cash to fund its operations 
                     and, if so, what are those steps and how likely does it 
                     believe that they will be successful? 
                   ------------------------------------------------------------------- 
                    Answer: Yes. In July 2020, the Company placed A$15m in 
                     zero coupon Convertible Notes to enable it to continue 
                     to deliver the Lake Way Project to schedule. The Company 
                     continues to work closely with Taurus to complete the 
                     PDF documentation, derisk the Project and satisfy the 
                     conditions precedent to the PDF (refer 7.6 above). The 
                     Company expects to provide an update to the market on 
                     funding to complete the Project in accordance with the 
                     schedule in the near future. 
                   ------------------------------------------------------------------- 
                    8.8.3 Does the entity expect to be able to continue its 
                     operations and to meet its business objectives and, if 
                     so, on what basis? 
                   ------------------------------------------------------------------- 
                    Answer: Yes. Further to the responses above, the Company 
                     has a reasonable expectation that it will complete project 
                     funding in the near future. The Company has an existing 
                     mandate with Taurus to provide staged project financing 
                     (refer 7.6 above). Negotiations with Taurus on the PDF 
                     have entered the final stage and satisfaction of conditions 
                     precedent are substantially advanced, which will allow 
                     completion of the Project in accordance with schedule. 
                     As evidenced by the recent placements, the Company has 
                     a strong institutional shareholder base and support for 
                     the Project remains strong. The Company is actively managing 
                     its cash and commitments to ensure that it can continue 
                     its operations and to meet its business objectives of 
                     constructing the Lake Way Project. 
                   ------------------------------------------------------------------- 
                    Note: where item 8.7 is less than 2 quarters, all of questions 
                     8.8.1, 8.8.2 and 8.8.3 above must be answered. 
-----------------  ------------------------------------------------------------------- 
 

Compliance statement

1 This statement has been prepared in accordance with accounting standards and policies which comply with Listing Rule 19.11A.

   2        This statement gives a true and fair view of the matters disclosed. 
   Date:                31 July 2020 

Authorised by: By the Board

(Name of body or officer authorising release - see note 4)

Notes

1. This quarterly cash flow report and the accompanying activity report provide a basis for informing the market about the entity's activities for the past quarter, how they have been financed and the effect this has had on its cash position. An entity that wishes to disclose additional information over and above the minimum required under the Listing Rules is encouraged to do so.

2. If this quarterly cash flow report has been prepared in accordance with Australian Accounting Standards, the definitions in, and provisions of, AASB 6: Exploration for and Evaluation of Mineral Resources and AASB 107: Statement of Cash Flows apply to this report. If this quarterly cash flow report has been prepared in accordance with other accounting standards agreed by ASX pursuant to Listing Rule 19.11A, the corresponding equivalent standards apply to this report.

3. Dividends received may be classified either as cash flows from operating activities or cash flows from investing activities, depending on the accounting policy of the entity.

4. If this report has been authorised for release to the market by your board of directors, you can insert here: "By the board". If it has been authorised for release to the market by a committee of your board of directors, you can insert here: "By the [name of board committee - eg Audit and Risk Committee]". If it has been authorised for release to the market by a disclosure committee, you can insert here: "By the Disclosure Committee".

5. If this report has been authorised for release to the market by your board of directors and you wish to hold yourself out as complying with recommendation 4.2 of the ASX Corporate Governance Council's Corporate Governance Principles and Recommendations, the board should have received a declaration from its CEO and CFO that, in their opinion, the financial records of the entity have been properly maintained, that this report complies with the appropriate accounting standards and gives a true and fair view of the cash flows of the entity, and that their opinion has been formed on the basis of a sound system of risk management and internal control which is operating effectively.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

END

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