Udon Potash mining status

[FrazeeDK]

This topic was touched on in the forum several years ago. It's quite an interesting topic as one way or another if the project comes to fruition it WILL affect those folks living in Udon Thani Province. I've seen nothing of import on this topic in the Thai news for a long time.. Some of you might live in the affected areas and be able to shed light on what's really going on right now.

This is the most recent I've found (2009) that implies Italian-Thai is moving forward with the mine
http://engagetheworld.wik.is/Issue_Reso ... otash_Mine

A 2008 article talks about the anti-mining villagers south of Udon
http://towardfreedom.com/home/asia/1463 ... wide-fight

The only 2009 BKK Post article I can find appears to be from the learning English section http://www.readbangkokpost.com/business ... dustry.php

A link back to an earlier actual news article is here http://www.bangkokpost.com/business/eco ... otash-woes

The fact that Udon has two huge Potash deposits that are surveyed as having literally millions of tons of recoverable Potassium used in fertilizer comes and goes in the media.

This is the most detailed article on the deposits I've found http://www.geog.pn.psu.ac.th/associatio ... ew_for.pdf

It's quite academic but lays out the surveyed resources and expectations of recoverable Potash reserves. Khon Khean University has a decent powerpoint on the Potash
home.kku.ac.th/laa/Potash003_2Udon%20Thani.ppt

This project has been up in the air for years now, caught up in accusations of phony Environmental Impact Assessments.

A nephew of mine, an abbot of a temple in the potentially mined area was an anti-mining activist over seven years ago due to the possibility of massive salt contamination that could occur as a by-product of mining. Even he doesn't know what's going on with the project now and his Wat is about 6 km from the Udon South area that is owned, fenced and guarded by the company that owns the project now.

On a worst case basis, if handled in typical Asian exploitative fashion, this project could totally destroy the agricultural ability of Udon province. Potash mining produces salt, both in liquid form and in dust. This could cause salt pollution of both the watershed feeding northward into the Mekong and the watershed feeding south past Nong han Khumpawapi. Since it's all deep mining (300-500 meters) it could also cause subsidence in all areas the mines are under.
If it were handled exceptionally well, it could mean a huge employment boost in the province and make Thailand quickly independent in Potassium fertilizer, which is a key cost to farmers in Thailand today. Some of the articles I've linked appear to delve into the environmental aspects in a very pro-mine way...

Looking at how most exploitative projects in Thailand are handled, i.e. with any dissent quashed and protesters arrested, I really wonder what's truly going on here. The financial incentive to get this project producing Potash is absolutely huge...
The south Udon Potash deposit is located east of Non Soong wihich is about 15 km south of Udon on RTE 2.
The prospective North Udon deposit appears to be paralell the railway line from Udon center to south about 10km and go east quite a ways..

[FrazeeDK]

Just to add a very important consumed resource of the mine.. Ground water.. I wonder what this huge consumption would do to the ability of the city/provincial water company to provide adequate water to all....??

From the 2003 KKU Powerpoint.

- Water Source- Groundwater (primary)
- Demand - 1,000,000 cu.m./year
- Period of use- During the construction phase of the project.

[udonuk1]

In england, i lived near a huge potash mine, biggest in Europe. It pumps water down many miles into ground , dissolves the potash . There is no problem with local agro land.. Maybe different here ?

[FrazeeDK]

and the international interest in Potash is documented in a recent bid for a Candian Potash company of 38.6 BILLION USD... http://www.bbc.co.uk/news/world-us-canada-11680181 It all still begs the question as to what is going on with the Udon South deposit???????????? The reserves are a potential gigantic (pardon the pun) "Gold Mine" of fertilizer base.. I can't believe the Thai business oligarchs aren't exploting this valuable resource...

[BobHelm]

I must admit that the Australian bid did set my mind wondering about the Udon reserves as well Frazee.
Maybe the Chinese have a 'wait until we have finished the Laos- China railway' reserve on it?
Maybe even a rail spur directly to the mine for Chinese processing?

From what I think you have said about it in the past a conventional mine with exports having to be shipped via sea would cause some severe strains on the local infrastructure & would be pretty unwelcome by everyone except the owners???

[FrazeeDK]

Bob, you've probably got ESP!!! Brilliant deduction. A Chinese built and owned broad guage railway from Kunming to Vientiane and across on a "new bridge" at Nong Khai.. Yes for sure, a large freight spur at Nong TaKai behind Nonsoong. Add to the known Udon Potash reserves a huge stash of Bauxite (for aluminum) in the Bolovens Plateau in Laos that equals Austalia's known reserves (15% of the world's reserves)http://www.ord.com.au/ASX%20Announcemen ... roject.pdf, and it's hoo-hah get the natural resources for China!! Do ya think the Chinese will also build a railway into Afghanistan (they have a short border with them) now that the Afghans have huge surveyed mineral resoureshttp://www.wealthdaily.com/articles/afg ... -find/2553... Better to get resources from a short distance vice Africa or South America although the Chinese have ramped up mineral investment in those continents too.. And, they've got the billions upon billions in foreign exchange reserves to dump into forward thinking exploitative projects like this.. We might see a Chinese financed high speed rail from Kunming to Bangkok via Nong Khai/Udon/Khon Khean/SaraBuri within 6-10 years!! and of course the spur along the Mekong down to the Bolovens for the Bauxite (or more probably finished Aluminum since Aluminum production requires vast amounts of electricity and what's Lao got?? Hydro and lots of potential for more).

[Aardvark]

Don't do me out of a Job just yet Frazee, Alumina is what pays my bills and China is our biggest Customer

[BobHelm]

Don't worry AA. If you think China will only be happy with 30% of the worlds' supply I would think again!!!

[jimboLV]

From what I think you have said about it in the past a conventional mine with exports having to be shipped via sea would cause some severe strains on the local infrastructure & would be pretty unwelcome by everyone except the owners???

I suspect it might be welcomed by the people who find jobs in the mining, transportation and support.

[BobHelm]

Well, you must know something that the original reports did not highlight then JimboLV..
There certainly seemed huge local opposition & little support previously...

[jimboLV]

Maybe so, Bob. But having been in the mining and nuclear industries for may years in the US I have seen this same scenario repeated any times. A project is proposed and the environmentalists and no-growth advocates marshal their considerable resources to whip up public sentiment with scare stories to oppose the project. Eventually the project is killed since it no longer makes economic sense with t he restrictions and multiple frivolous lawsuits. Then the people sit back and wonder why the unemployment rate is so high. Of course the environmentalists move on to the next "opportunity", since most of them are rich and don't have to worry about making a living. A biased view of course, but I've seen it happen too many times and suspect the same thing is in play here.

[BobHelm]

Yes, I am sure that often happens as well Jimbo.
It is a difficult balancing act & both sides have a point.
As far as I understand the local neighbours (not imported 'do gooders') raised concerns - especially over salt contamination - with the company. In a largely agricultural area this is, obviously, a major worry to them. The consortium produced an Environmental Impact Analysis that was very self serving & full of errors. From then on any trust was broken, as it tends to be in those circumstances.
At about the same time I think that maybe the Thai Government possibly thought that the Italian lead consortium might no longer offer the most sensible choice to develop the mine. I also think the consortium possibly came to the same conclusion as neither of those parties have attempted to push the matter in any way.
As Frazee has pointed out there is just too much value lying underground there for it not to be developed.

[LoongLee]

FrazeeDK: This is the most recent I've found (2009) that implies Italian-Thai is moving forward with the mine
http://engagetheworld.wik.is/Issue_Reso ... otash_Mine

Quote:

"Located only 350 meters beneath the Earth’s surface, the 300 million tons of potash are extremely accessible for mining and one of the largest deposits in the world. The mine would be in operation for 25-30 years and produce 2.0 million tons each year." (30 years times 2 million tons per year equals 60 million tons,,,what about the other 240 million tons?,,,,LoongLee)

"The Mineral Act of 1967 stated that property ownership extended to 350 meters below ground. Therefore, the shallowness and accessibility of the potash found in Udon presented a legal challenge for developers. After years of lobbying and debate from the APPC, the House of Representatives passed amendments in 2002 to allow companies to mine at a depth of 100 meters without notifying or obtaining permission from landowners.",, (This just about says it all as far as the future for the local citizens and their rights,,,,LoongLee.)

My money says this will not be managed in an ecologicaly correct way to protect the environment and the locals. LL

[FrazeeDK]

guess we'll have to wait for the broad gauge Chinese railway to make it down to Udon before the mines get going. First they'll develop Udon south down east of the railway near Non Soong, then they'll move up to Udon North deposit which is east of the railway line and extending out past the ring road.. If all is done in a normal fashion, 10-15 years from now, Udon will be a salt-encrusted moonscape!! On the other hand, if some type of realistic "sustained" development is done, Udon's Potash deposits will supply the fertilizer needs of SE Asia for over 20 years, thousands will get direct/indirect employment in the area, and there will be a broad gauge high speed railway BKK to Kunming via Udon..

[LoongLee]

FrazeeDK,,,,"guess we'll have to wait for the broad gauge Chinese railway to make it down to Udon",,,,,,,,,

Actually Frazee,,,,, I think you'll find the Chinese use a standard gauge (4 feet 8.5inch),, the same as the UK and North America. I believe the standard gauge is about 60 % of the rail worldwide.

[Texpat]

Why let something as trivial as standard gauge slow you down?

[38nholding]

Time to get into the bottled water business! A little something I read from the posted info.

"Chemicals from mineral processing and huge amounts of salt byproduct - a pile expected to be 40 meters tall by a kilometer long - are to be stored on a hill between two watersheds directly above the area’s shallow underground reservoir. This is the region’s primary water source. Ministry officials who performed the assessment contend the proposed chemical storage site is the worst possible choice from a community health perspective"

[parrot]

There's a news item in UdClick.com concerning a protest against the potash mine that occurred on 21 Dec at the city center (http://www.udclick.com/home1/index.php? ... mid=127041)
Apparently, 500 villagers from 6 different tamboons presented a letter to the Udon governor protesting any plans for the mine. I'm not sure of the exact translation, but it seems that the protesters got no response to their letter, and after 3 hours decided to burn an effigy in further protest.
The villagers/protesters are also concerned about any environmental studies that may not take their best interests into account (my 2cent translation).

So the battle continues.......with big stakes for the villagers, the city, the country, and for related businesses, one wonders how it'll all turn out.

[bumper]

Business > Economics

Buyers sought for 15% of potash project
Published: 9/06/2011 at 12:00 AM
Newspaper section: Business

Italian-Thai Development Plc (ITD), the country's largest contractor, is offering for sale 15% of its delayed $800-million potash mine in Udon Thani with a plan to begin construction early next year.

The company has been approached by both Thai and foreign partners who want to take part in the 24.3-billion-baht project in which ITD owns 90%, with the rest held by the Thai government, said Chartchai Chutima, deputy chief executive of finance.

Bangkok Bank, the project's financial adviser, has been working on the sale of 15% of ITD's shares. Details are expected to be finalised this month and the deal should be completed within this year, Mr Chartchai said.

Developed by Asia-Pacific Potash Corp (AAPC), the project has been delayed for five years because of environmental concerns."We expect to have the environmental impact assessment (EIA) report approved within this year together with a mining licence. The construction is targeted to commence in early 2012 and the project will be operational in two years," he said.

With the project's annual capacity of up to three million tonnes, Thailand is poised to gain significantly from exports by AAPC given the potash price in the range of $500 and $600 per tonne today, he added.

ITD, meanwhile, is scheduled to sign a contract worth 8 billion baht with the State Railway of Thailand next week for track rehabilitation. The project will start to generate revenue for the contractor this year.

ITD, which reported a net loss of 207.45 million baht in the first quarter against a net profit of 179 million in the same period of 2010, could return to profitability next year when its huge Dawei development project in Burma, as well as the Blue mass-transit rail line in Bangkok, begin to generate revenue, said Mr Chartchai

President Premchai Karnasuta said the company was also beginning the construction of an aluminum smelter in Laos at a cost of around 50 billion baht. The project will take two years to complete.

As well, work on a US$4.5-billion electric train project in Vietnam is under development with a total distance of 60 kilometres. ITD will also bid for the Green and Red rail lines in Bangkok later this year.

"We have been in talks with the governments of Kuwait, Qatar and Saudi Arabia to construct housing projects there. Orders from all Arabian countries totalled two million units of houses, including 5,000 units in Kuwait," Mr Premchai added.

ITD shares closed yesterday on the Stock Exchange of Thailand at 3.46 baht, down 18 satang, in trade worth 91.99 million baht.

[FrazeeDK]

The studies show that Thailand could stop importing ANY potassium based fertilizers about one year after the3 Udon Potash mine starts production.. It will also affect the high prices farmers now borrow and pay for imported fertilizer.. IF, IF managed properly, this could be a big win for Thailand.....

Further mineral development....

note the quote "President Premchai Karnasuta said the company was also beginning the construction of an aluminum smelter in Laos at a cost of around 50 billion baht. The project will take two years to complete.

".. This is supporting the gigantic Bauxite deposits in the southern Bolovens Plateau.. With Bauxite, electricity and now an aluminum smelter, Laos is setting itself up to be a huge aluminum exporter.. Remember the rail upgrades in Laos associated with the high speed rail Kunming via Lao to Bangkok.. Bet there will be a track down the Mekong valley to the Bolovens to haul finished aluminum back up to China.. YOu can also bet an extension of SRT to the Mukdahan Savannakeht bridge and its extension across RTE 9 to Vietnam and the deep water port of Danang.