The One Mineral That Could Help Solve World Hunger

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The One Mineral That Could Help Solve World Hunger

FN Media Group Presents OilPrice.com News Commentary

PR Newswire

LONDON, April 25, 2018 /PRNewswire/ --

The World's population keeps getting bigger. Multi-millions in Asia are joining the middle class, and they are demanding the same luxuries westerners have taken for granted for decades. It's pushing the world's food infrastructure to provide more and more and more. Mentioned in today's commentary includes: Teck Resources TECK, Endeavor Silver EXK, Eldorado Gold Corp. EGO, Tronox Limited TROX.

To make matters worse - climate change has been destroying arable farmland at the fastest rate in human history. We now need to grow more with up to 30 percent less land. If humanity is going to survive - it will need millions of tons of a little-known mineral called potash.

Companies like Vatic Ventures (VCV, VTTCF) aim to be the ones to deliver it. Right now, they're sitting on a promising property in Thailand's Khorat Basin.

Thailand is home to what could be one of the largest undeveloped, high-grade potash plays on Earth. And, Vatic's project? It is located right beside a potential $1.8 billion Dan Khun Thot find.

As potash prices rise - here are 5 reasons investors are paying attention to developments in Thailand:

  1. Rise Of The Asian Middle Class 
  2. The Largest Undeveloped Potash Region On Earth 
  3. Next Door To Major Import Markets 
  4. Properties Adjacent To A $1.8 Billion Find 
  5. The Thai Potash Dream Team  

How The Asian Middle Class Is Driving Potash Prices  

The global population keeps growing. The world is adding 200,000 people every single day - with an expectation of 7.7 billion hungry mouths by 2020. It's plunging the world into an ever-growing need for higher quality, more plentiful food.

With the rise of the new Asian middle class - it's about to get a lot worse. For companies like Vatic Ventures (VCV, VTTCF), that represents an enormous opportunity.

According to a 2017 study by the Brookings Institution, 88 percent of the next 1 billion people to enter the middle class globally will be from Asia. The size of the Asian middle class is expected to reach 3.5 billion people by 2030.

The problem? Farmers are running out of land suitable for growing food. In fact, scientists say that over the last 40 years the world's lost one-third of its arable land due to erosion and pollution. More and more potash is needed to maximize the crop yields.

That's why demand for potash is soaring - with annual consumption expected to grow from 60 million tons to 70 million tons by 2020.Prices could go soaring without major new sources of potash coming on stream.


And that's good news for Vatic (VCV, VTTCF ).

Potentially The Greatest Undeveloped Potash Play On Earth 

Thailand's Khorat basin potentially holds the world's largest undeveloped high-grade potash resources. It contains the only known, commercially viable deposits in Asia, not far from Vatic's own property. The potash is located within a 100-million-year-old layer of rocks known as the Maha Sarakahm Formation - with resource intervals that are 10-75m thick.

Vatic Ventures ( VCV, VTTCF) has a property right in the middle of it, and right next door to a project that potentially holds $1.8 billion worth of potash, based on numbers from the Dan Khun Thot project.

Many deposits in the region are shallow, at 150 to 350 meters. That's compared with up to 1,900 meters in Russia or Canada - making them more economical to develop. Not only that, but exploration costs in the area are lower compared to other projects.

A Massive Logistical Edge  

Not only does Thailand have potentially the world's largest undeveloped high-grade potash resource in the Khorat Basin, it's also smack dab in the middle of Asia's biggest import market. Some of Asia's top importers of potash are Thailand, Malaysia, Vietnam and Indonesia. What's more, that figure is expected to rise by at least 5 percent a year.

Vatic (VCV, VTTCF) - with two very exciting licenses in the Khorat basin - stands to play a key role in supplying the region's growing demand for fertilizer.

"Location is the key to this," says Nasim Tyab, Executive Director of Vatic, "because potash is sold by the ton so there is at least a $1.8 per ton transportation advantage to sell into the Asian market compared to overseas potash."


That's a huge savings considering the cost of potash itself in South East Asia is about $300 a ton, as the region pays a premium on imports compared to the world price of about $230 per ton.

Even at today's potash prices, Vatic aims for good profit margins. With prices expected by many to rise - they're leveraged to the market. And, they're sitting on one of the most promising projects in the region.

The Crown Jewel Of The Khorat Basin  

In January 2017, Vatic ( VCV, VTTCF) acquired 80% of the issued and outstanding shares of a Thai company - Saksrithai Development Co. Ltd. Saksrithai holds two contiguous Special Prospecting Licenses (SPLs) covering an area of 32 km² in the Khorat Basin, for the exploration of potash.

The properties are right next door to the Dan Khun Thot project, which hasan initial potash mining reserve in excess of 100 million tons. Their find is worth $1.8 billion at current market prices.

More importantly? At a potash grade of almost 22 percent KCL - the Dan Khun Thot project has better economics than most proposed potash projects. Production levels are projected to start at 500,000 tons per year. Why is that so compelling for Vatic?

Because initial review of the seismic data demonstrates their neighboring Saksrithai Project has structural continuity with the Dan Khun Thot property. In February 2017, Vatic commenced the first phase of its exploration program.

Phase 1 of the project, with a budget of $1.5 million, includes the completion of a pre-feasibility study and estimation of a 'potash resource'.

"In fact, the allowed spacing between drill holes is 4 kilometers, so basically there is a very high probability we are going to hit potash."

Another reason to expect success? Just look at the team Vatic has put together.

Thailand's Potash Superstars 

Nasim Tyab has been Director since 2011. When it comes to the nascent potash industry in Thailand, few are as knowledgeable as he is. Before joining Vatic (VCV, VTTCF), Tyab served as a consultant in the Udon Thani Potash Project - developed by Asia Pacific Resources in the mid-1990s.


That project turned into Asia's most significant commercial potash discovery to date - shooting the company's market cap to nearly $1 billion. After that game-changing discovery, in 2016 the CEO of Asia Pacific asked Tyab to join him in another Thai-based potash project - which was then sold to Vatic Ventures.

"So, in January 2017 I did the deal with him and he became CEO of Vatic," Tyab said, "and he had this project and rolled it in for shares and now he is aligned with the shareholders."

That venture is the Saksrithai Project and the new CEO of Vatic is Dr. Gerald Wright. Together they're betting Vatic's (VCV, VTTCF) Saksrithai Project will eclipse it.

Conclusion 

With a rising Asian middle class hungry for Western levels of consumption, and rapidly shrinking arable land - the world needs a lot more potash.

Vatic's Saksrithai project in the Khorat Basin is right beside a potential $1.8 billion resource, and just a stone's throw from massive potash import markets.

In May, Vatic is kicking off a drilling program. According to Vatic Executive Director Nasim Tyab - "that should be a value transformation because if we get what next door has, we have a very valuable asset."


If they hit near the grades that are found next door at Dan Khun Thot - they would be imminently undervalued. Vatic (VCV, VTTCF) is one to watch.

Other companies in a promising position as commodities boom:

Teck Resources TECK: Zinc hasn't been Teck's best friend of late, but that looks set to change in the medium term, as supply continue to dwindle and as we hear news that the world's top producer of the metal-Glencore-isn't planning to bring shuttered mines back online. Supply will remain tight.


Endeavor Silver EXK operates three silver-gold mines in Mexico, but it's also got three attractive development projects. Production has dropped, and all-in sustaining costs have risen, leading to a negative cash flow. But the company has significantly reduced its debt, so its future is anything but bleak.


Eldorado Gold Corp. EGO: This Canadian mid-cap miner has assets in Europe and Brazil and has managed to cut cost per ounce significantly last year. Due to a steep loss in 2016, the company saw its share price tank in 2017. Analysts, however, are getting bullish on this stock again as gold prices are rising.

Tronox Limited TROX is a North American based chemical company involved in the titanium products industry. Tronox is the third-largest titanium feedstock producer, with approximately 10% of global titanium ore production; and the second-largest producer of zircon, with approximately 20% of global production. The company also has an electrolytic and specialty chemicals business that services the paper and battery industries.


By. Charles Kennedy

**IMPORTANT! BY READING OUR CONTENT YOU EXPLICITLY AGREE TO THE FOLLOWING. PLEASE READ CAREFULLY**
 

Forward-Looking Statements 

This news release contains forward-looking information which is subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ from those projected in the forward-looking statements. Forward looking statements in this release include that the Thailand potash resource will prove as large and as high grade as hoped; that the potash reserves can be mined; that Vatic will have sufficient funds to develop the potash fields to the point of profitability; that the price for potash will rise; that the Thai project will be able to produce potash as currently scheduled; that Vatic's potash will enjoy lower costs to market; that Vatic's exploration and operating costs will be lower than other potash projects; that the potash when produced by Vatic will be high quality suitable for standard use; and that Vatic will be able to carry out its business plans. These forward-looking statements are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking information. Risks that could change or prevent these statements from coming to fruition include that Vatic may not get Thai approval for its mining, production and sale/export of potash; Vatic may not be able to pay the costs of development; aspects or all of the property's development may not be successful, production of potash may not be cost effective as expected; there is substantial political risk in Thailand, which have the potential of harming production and assets or having assets expropriated; Vatic may not raise sufficient funds to carry out its plans, changing costs for extraction and processing; increased capital costs; the timing and content of upcoming work programs; geological interpretations and technological results based on current data that may change with more detailed information or testing; potential process methods and resource recoveries assumptions based on limited test work with further test work may not be viable; world potash prices may drop; the availability of labour, equipment and markets for the products produced; and despite the current expected viability of its projects, that the potash reserves are not proven or cannot be economically produced on its properties, or that the required permits to build and operate the envisaged facilities cannot be obtained. Currently, Vatic has no revenues. The forward-looking information contained herein is given as of the date hereof and the Company assumes no responsibility to update or revise such information to reflect new events or circumstances, except as required by law.

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PAID ADVERTISEMENT. This communication is a paid advertisement and is not a recommendation to buy or sell securities. Oilprice.com, Advanced Media Solutions Ltd, and their owners, managers, employees, and assigns (collectively "the Company") has been paid by the profiled company or a third party to disseminate this communication. In this case the Company has been paid by Vatic ninety thousand US dollars for this article and certain banner ads. This compensation is a major conflict with our ability to be unbiased, more specifically:

This communication is for entertainment purposes only. Never invest purely based on our communication. Gains mentioned in our newsletter and on our website may be based on end-of- day or intraday data. We have been compensated by Vatic to conduct investor awareness advertising for VCV and Frankfurt: V8V2. Therefore, this communication should be viewed as a commercial advertisement only. We have not investigated the background of the profiled company. The third party, profiled company, or their affiliates may liquidate shares of the profiled company at or near the time you receive this communication, which has the potential to hurt share prices. Frequently companies profiled in our alerts experience a large increase in volume and share price during the course of investor awareness marketing, which often end as soon as the investor awareness marketing ceases. The investor awareness marketing may be as brief as one day, after which a large decrease in volume and share price is likely to occur.

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