CRP to apply for mining licence this year, after wealth of data gathering

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Chatham Rock Phosphate (CRP) plans to apply for a mining licence in June and a marine consent in September after gathering a wealth of information during 48 days surveying on the Chatham Rise this summer.

The information, targeted at the Rise’s significant phosphate resource, also contributes significantly to the store of public good information used by scientists to understand New Zealand’s oceanic environment.

The 100 m Dorado Discovery, based in New Zealand since December has conducted four research surveys for CRP, using a range of high tech equipment. The surveys collected geophysical data in December, bottom samples in February, environmental data in March and geotechnical data in April. CRP’s last cruise ended today and the mammoth job of resource modelling, environmental assessment and geotechnical analysis now begins.

CRP chief executive Chris Castle said the trips have generated a massive amount of data.  “Following the four trips to Chatham Rise, there is now available a wealth of geophysical data and remote operated vehicle (ROV) observations, as well as a great variety of sea floor samples including box cores, vibrocores and grab samples.

“Based on geophysical and environmental data, CRP will be able to tie it all together and optimise the mining efforts. The project has all it needs to move forward.” 

Mr Castle paid tribute to the work done by the project team, and the scientists, engineers and other technical staff gathered from the United States, Netherlands, Germany and New Zealand who worked under immense time pressure. “Our team put together these trips in just a few weeks; it normally takes months or even years.” 

“Our focus now is on undertaking the necessary analysis and preparing the reports required for the two key consents we need,” Mr Castle said.  “We plan to begin production in 2014.”

The data and samples acquired by the four cruises will be used for:

  • The application for the mining licence
  • The environmental impact assessment report required to accompany the application for a marine (environmental) consent
  • Refinement of the design of the phosphate recovery and on-board separation systems
  • Acceleration of the rock phosphate beneficiation studies presently under way
  • Further design work in respect of the on-board glauconite separation systems
  • New fertiliser market development.

“The project continues to maintain considerable momentum. We have a strong focus on setting objectives and achieving ongoing milestones.  We have met all our key deadlines so far and we are determined to keep delivering on our goals.”

Boskalis project leader Gerard Van Raalte said the data gathering this summer is invaluable for designing the undersea and onboard extraction equipment and separation techniques.

“We are also results orientated and so we are working very well with the CRP team.”

December cruise:

The survey mapped 715 km2 of the sea floor with multi-beam swath bathymetry (seafloor topography) data and 199 km2 with side-scan sonar data. It collected 263 km of sub-bottom seismic reflection data and magnetic data.  The survey collected information about the shape and character of the sea floor and the properties of the shallow sediments that will help understand the distribution of the phosphate resource. The data guided planning for subsequent surveys, assisted the development of mining technology and strategy, and contributed to the identification of priority areas for the first few years of mining. The ship recovered two oceanographic moorings that had collected current and turbidity data, now downloaded for processing and analysis.

The new detailed bathymetry data show the irregularity is primarily the result of underlying geology and iceberg scours up 15 m deep, 400 m wide and tens of km long. The data obtained are valuable for the detailed design of the dredging operations.

February cruise:

The survey collected 50 precisely located grab samples, bringing more that 35 tonnes of sediment back to analyse nodule content and distribution and test separation techniques. The bulk sediment also brought in considerable environmental data that contributed to the March environmental survey. The project team conducted four ROV dives (the first ever on the Chatham Rise) to inspect the sea floor before and after grab sampling and to test the physical properties of the sediment, as well as expanding the geophysical mapping of the sea floor.

March cruise:

The team surveyed 13 of the environmental areas identified by NIWA (eight target mining areas and five reference areas outside mining zones) and collected more than 77 km of ROV video transects, recording more than 150 hours (or 700 Gb) of video and 62,000 observations from the video transects as well as 17,000 still photos.  In addition, the cruise collected 130 box cores from 38 sites, 3 km2 of high-resolution bathymetry and backscatter data and more than 500 km2 of regional bathymetry data.  The ROV stopped on 12 occasions to take biology samples or close-up photos.  The sampling and photography will enable detailed assessment of animals that live on the seafloor.

April cruise:

The cruise, with Boskalis engineers on board, involved the first investigation that specifically focused on properties of the seafloor as they relate to design and construction of a mining machine. Four ROV dives tested the geotechnical properties of the sand and chalk, including how hydraulic jets could loosen the sediment without creating high turbidity before the phosphate and associated sediment can be pumped on board for separation. Cone Penetration Test (CPT) measurements were done at 129 sites, collecting information about sediment strength, hardness, friction and porewater pressure. Fifteen short vibrocores returned 12.6 m of sediment. A vibrocorer uses vibration to work the core tube into the seabed as distinct to a corer that relies on gravity alone for penetration into the sediments.  The cruise took four box core samples for environmental and geotechnical analysis.

Chris Castle

021 55 81 85
chris@widespread.co.nz

 

Veteran adventurer scientist hits the high seas again

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Thirty years after he first explored the seabed of the Chatham Rise, off the coast of New Zealand, colourful oceans scientist Dr Hermann Kudrass, now in his late 60s, is about to voyage to one of the most rugged parts of the Pacific again.

Dr Kudrass led a joint New Zealand-German government expedition on the German government research vessel Sonne in 1981 to explore the extent of phosphorite deposits distributed on the Rise seabed and then wrote a book discussing his findings.

Now, three decades later he is being hosted by Chatham Rock Phosphate, the New Zealand company planning to extract some of the rock phosphate to use as fertiliser, to venture back to the same area.

Dr Kudrass has spent a lifetime exploring the subsea around the world.  Known as ‘Herman the German’ within the oceans scientific community, he attained a PhD in geology before joining the Marine Geology Department of the Federal Institute for Geosciences and Natural Resources (BGR) in Hanover.  Since 2005 he has headed the Division of Geophysics, Marine and Polar Research at BGR.

This role has led him to a number of adventurous expeditions in remote parts of the world including exploring heavy mineral sands off Malaysia and Mozambique, the history of monsoon in the Bay of Bengal; geology of the South China Sea and teaching UNESCO courses in several developing countries.

Despite the heavy seas common in that part of the Pacific, Dr Kudrass is highly excited to be off on another voyage.

This time it will be on the Dorado Discovery, which has already undertaken three cruises this summer to the Rise to collect a range of environmental and geotechnical data, and test equipment, for Chatham Rock Phosphate.

“When we first discovered the phosphate rock more than three decades ago, we could see the potential for it.  Now the rising market value of the resource and the advances in technology mean the rock phosphate will be used on New Zealand farms and for export.”

Benefits of the project include:

  • New Zealand controlled: The project’s owner holds 100% of the licence area estimated to contain a 15-year supply of rock phosphate for the New Zealand market
  • Known costs and technology: Mining concept studies indicate an extension of existing technology can extract the resource from the seabed for much less than the cost of buying it and importing it from Morocco
  • Economic benefits: This project could significantly reduce New Zealand’s exposure to foreign exchange risk while improving its balance of payments position by reducing imports and/or generating export earnings.
  • Environmental benefits: The phosphate can be applied directly, is more effective than super-phosphate and very low in cadmium.  The technologies used will minimise seafloor disturbance, there will be a lower carbon footprint through reduced transport requirements, and extraction will intermittently affect a total footprint of less than 1/1000th of the Chatham Rise seafloor.

Editors note: Dr Kudrass is available for interview

For further information please contact Linda Sanders on 03 525 9170 or linda.sanders@xtra.co.nz

 

Environmental focus for latest Chatham Rise cruise

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15 March 2012

Research Vessel Dorado Discovery is heading for the Chatham Rise today to gather a range of environmental and geotechnical data for Chatham Rock Phosphate.

The Dorado will spend about a month, in two separate legs, with a range of scientists from Crown research agencies NIWA and GNS, plus other technical staff contracted to CRP including Royal Boskalis Westminster, Golder Associates and Kenex.

“Our focus is gathering information to prepare an environmental impact report as part of our plan to apply for a mining licence this year,” managing director Chris Castle said.

CRP is financing the cruise through new equity raised from Subsea Investments.  The company’s other major shareholder is NZX listed Widespread Portfolios Ltd.

Mr Castle said the scientists on the cruise will gather a significant amount of data relating to the oceans environment in the area planned for extraction – most particularly: 

  • seabed photography of benthic biota
  • more information on sediment chemistry and physical characteristics
  • collection of samples for evaluation of benthic organisms.

“We are working very closely with NIWA, which is advising what data, relating to sea conditions and habitat, will be needed to prepare the necessary reports.  This will enable us to evaluate the potential impact of extraction and how we can manage any effects.

“NIWA has done a great job in working with the CRP during a very short time frame to bring together the people, equipment and information needed for the cruise,” Mr Castle said.  The availability of the Dorado Discovery is dictating the timing of the cruise.

“The environmental leg of the voyage will include using a remote operated vehicle (ROV) to examine conditions on the sea floor in various parts of CRP’s licence area.

CRP holds an exploration licence over 4276 sq km, 450 km east of Wellington, at shallow depths on the Chatham Rise and in New Zealand territory.  CRP has now entered the second two-year period of its exploration licence and has priority rights to apply for a mining licence. 

New Zealand Petroleum and Minerals has approved the testing work.

The second leg of the cruise later this month will focus on gathering geotechnical information to assist Boskalis in the design of extraction technology, expected to be based on existing dredging mechanisms, adapted for seabed conditions.

CRP has already used the Dorado Discovery for a preliminary information-gathering cruise, before Christmas, and in February to test grab sampling machinery. These data are currently being collated and analysed and are being used to inform the priorities of the current cruise.

The data and images collected over the current New Zealand summer involve the most significant research work undertaken of the Chatham Rise since the German vessel Sonne’s major cruise in 1981 as part of efforts by a New Zealand-German joint venture to evaluate the commercial viability of the area’s rock phosphate deposits.

The Dorado Discovery, operated by Odyssey Marine Exploration (NASDAQ:OMEX), is specially equipped for marine mineral exploration and has been undertaking such work in the south-west Pacific for the last 15 months.

Benefits of the project include:

  • New Zealand controlled: The project’s owner holds 100% of the licence area estimated to contain a 15-year supply of rock phosphate for the New Zealand market
  • Known costs and technology: Mining concept studies indicate an extension of existing technology can extract the resource from the seabed for much less than the cost of buying it and importing it from Morocco
  • Economic benefits: This project could significantly reduce New Zealand’s exposure to foreign exchange risk while improving its balance of payments position by reducing imports and/or generating export earnings.
  • Environmental benefits: The phosphate can be applied directly, is more effective than super-phosphate and very low in cadmium.  The technologies used will minimise seafloor disturbance, there will be a lower carbon footprint through reduced transport requirements, and extraction will intermittently affect a total footprint of less than 1/1000th of the Chatham Rise seafloor.

Chris Castle
021 55 81 85  
chris@widespread.co.nz

 

Chatham Rock Phosphate Secures Financing with Subsea Investments

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13 March 2012

Chatham Rock Phosphate (CRP) is pleased to advise that it has today entered an Investment Agreement (the Agreement) with Subsea Investments II, LLC (Subsea).

Pursuant to the Agreement CRP has today issued to Subsea:

  • 11,442,641 shares at an issue price of $0.20 per share to raise NZD$2.28 million.
  • 11,442,641 unlisted options which have a three year term and may be exercised into ordinary shares on a 1:1 basis for an exercise price of $0.30 per share (Options).

The Agreement further provides that, subject to CRP shareholder approval in accordance with the listing rules, CRP will (at Subsea’s discretion):

  • Issue up to a further 1,853,429 shares to Subsea at an issue price of $0.20 per share to raise a further NZD$370,000.
  • Issue up to a further 18,319,264 Options to Subsea (matching on a 1:1 basis the shares issued above and the shares that may be issued on conversion of the Loan below).
  • Enter a convertible loan agreement with Subsea where Subsea will advance up to $3.3 million to CRP (Loan). Subject to compliance with the Takeovers Code, the Loan can be converted by either CRP or Subsea into shares in CRP at a conversion price of $0.20 per share. The Agreement also provides that Subsea may, but is not obliged to, advance a further NZD$1.2 million to CRP on the same terms and conditions except that:
    • The conversion price for that subsequent advance will be agreed at the time that the advance is made but will not be less than $0.20 per share; and
    • No Options will be issued in connection with that subsequent advance.

The Board of CRP intends to hold a special meeting in approximately three weeks time for shareholders to consider approving these further transactions. If approved:

  • Subsea will hold a 19.99% shareholding in CRP.
  • CRP will have up to approximately NZD$7 million in new capital through the above share issues and the Loan.
  • Subsea will hold up to 30 million options which, if all exercised, would generate an additional NZD$9 million in new capital for CRP.

Full details of these transactions will be set out in the notice of special meeting which will be released to the market and posted to shareholders at the end of next week.

The Board of CRP is delighted to welcome Subsea as a cornerstone investor in the company. This year’s work programme for CRP is likely to cost NZD$8-$10 million and we expect that this investment will ultimately constitute over half of that funding requirement. We also now have a number of avenues to pursue to fund the balance of our work programme. Subsea’s investment is therefore a significant and exciting step in securing the future of our rock phosphate project.

Full particulars of today's allotments follow below and include an allotment of 50,000 shares to a qualified investor at $0.20 per share.

Chris Castle
Managing Director
Email: chris@widespread.co.nz

 

Chatham Rock Phosphate Raises $325,000 under Share Purchase Plan

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13 February 2012

The Chatham Rock Phosphate share purchase plan closed on 3 February 2012. Under the Plan, 72 eligible shareholders have subscribed for 1,624,492 shares in total raising approximately $325,000 at the issue price of $0.20 per share. The Board is very pleased with this outcome given the timing of this offer and thanks shareholders for their continued support of the company.

In addition to the allotment of shares under the share purchase plan, Chatham Rock Phosphate has also undertaken placements today of 986,110 shares to qualified investors at an issue price of $0.20 per share.

Full particulars of these allotments are set out below.

On behalf of the Board,

Chris Castle
Managing Director

Email: chris@widespread.co.nz

Class of security:  Ordinary Shares
ISIN:  NZWENE0003S0
Number issued:  2,610,602
Issue price:  $0.20 per share
Payment in cash:  Yes
Fully paid:  Yes
Percentage of class:  5.16%
Purpose of the issue:  Funds raised will be applied as announced to the market on 1  December 2011.
Authority for the issue:  Board resolutions
Date of issue:  13 February 2012
Total number of securities on issue following allotments:  53,217,538 ordinary shares