Wednesday, October 14, 2009

Twin Buttes Ranch acquired for potash

A press release by Passport Metals this morning says they have leased the Twin Buttes Ranch in the Holbrook basin for 4 years with an option to buy it for $20 million. [right, light green tracts are ranch lands. Blue are existing Passport leases with drillholes. Federal lands in PFNP in dark green. Credit, Passport Metals] The company says the ranch encompasses some 28,526 acre, of which about 21,894 acres are underlain by potash.

The roughly 60 square mile ranch was included in the expansion of the Park approved by Congress in 2004, but money was never appropriated to buy the private lands.

Ranch owner Mike Fitzgerald has been widely quoted as expressing a willingness to sell his land but also frustration at the wait for Congress to act. He put the property up for sale last year at a reported price of $10.5 million. But around the same time the price of potash was skyrocketing from $50-100 per ton to as much as $900-1,000 on the global spot market. Companies starting picking up leases in the Holbrook basin. Then, in the Fall, AZGS released the first resource estimates of the potash deposit, showing it could hold as much as one-quarter of all the potash in the U.S. Since then, all state lands have been leased in the area and there is stiff competition for private leases and lands.

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