PhosCan Chemical Corp.
TSX VENTURE : FOS

PhosCan Chemical Corp.
BALTIC RESOURCES INC.
TSX VENTURE : BLR

BALTIC RESOURCES INC.

January 07, 2008 13:19 ET

PhosCan Announces Winter Drill Program for Martison Phosphate Project

TORONTO, ONTARIO--(Marketwire - Jan. 7, 2008) - PhosCan Chemical Corp. (TSX VENTURE:FOS) and Baltic Resources Inc. (TSX VENTURE:BLR) (collectively, the "JV Parties") are pleased to announce the start of the 2008 winter work program at their jointly owned Martison Phosphate Project located approximately 70 km northeast of Hearst, Ontario.

PhosCan, as operator of the joint venture, will conduct a major $6.5 million, 80 hole drilling program focused on moving the project towards a bankable feasibility study. The JV Parties intend to immediately commence the feasibility study upon completion of the pre-feasibility study, which is expected by early March, 2008.

The Martison Phosphate Project

The Martison Phosphate Project is currently being examined for its potential as the key supplier of phosphate concentrate for a vertically integrated phosphoric acid plant to be developed near Hearst, Ontario. The plant would utilize the Martison phosphate deposit as well as sulphuric acid from nearby Ontario base-metal smelters. Phosphate concentrate and sulphuric acid are the two primary inputs in the production of phosphoric acid. The Martison project and the proposed plant are strategically positioned in proximity to target markets with ready access to infrastructure including rail, power, labour and an abundant supply of sulphuric acid. The phosphoric acid produced, will be used as feedstock for the production of higher-value products in the fertilizer and industrial phosphate markets.

Current resource estimates for the Martison deposit are based on data from 120 holes completed in six drilling campaigns. The Measured and Indicated resources form the foundation for the pre-feasibility study currently being conducted by Jacobs Engineering and Golder Associates. The highlights include:

- Measured and Indicated resource of 62.2 million tonnes averaging 23.55 % P2O5 and 0.34 % Nb2O5.

- Inferred resources of 55.7 million tonnes averaging 21.87 % P2O5 and 0.34 % Nb2O5.

- Significant areas of the residuum in the central portion of the deposit remain open at depth.

The 2008 Winter Work Progam

The program will include three major components. The first component is a geotechnical study which will focus on the proposed mine pit area as well as proposed areas for infrastructure construction. The second component of the program is dedicated to the collection of a 40-tonne bulk sample of residuum (Litho Units 2A and 2B). The bulk sample will provide the material for further bench-scale refinement of the selected metallurgical process as well as pilot-plant scale confirmation testing of the selected and refined process. Concentrate ("phosrock") from the pilot plant testing will be used in phosphoric acid manufacturing and fertilizer manufacturing testing and process refinement. The third component of the program will focus on the definition of the bottom of the residuum, which is currently undefined in the central area of the proposed mine pit.

The three components of the planned 2008 winter field program will involve drilling approximately 80 holes in 60 locations. As the drill program advances, an independent survey crew will be responsible for surveying all of the drill hole locations and other surface features to tie these sites into the most recent airborne survey data. The total cost of the 2008 winter program is estimated to be approximately $6.5 million, which forms part of the budgeted costs for the bankable feasibility study.

James S Spalding completed the independent resource estimate according to CIM resource categories in compliance with NI 43-101 guidelines and a Technical Report for the Martison property is available on SEDAR.

First Nations Access Agreement

In connection with the planning and implementation of the 2008 winter work program, the JV Parties are pleased to announce they have entered into a pre-mining exploration agreement (the "Access Agreement") with Constance Lake First Nation ("CLFN"), which claims traditional lands rights on the property where the Martison Phosphate deposit is located. The Access Agreement, among other things, provides full access to the JV Parties to carry out the above-noted winter work program on the property, funding for CLFN to negotiate a broader mining exploration agreement in respect of the Martison Phosphate Project and commits the JV Parties to enter an Impact Benefit Agreement (IBA) with the affected First Nations.

Proposed Merger to Consolidate 100% Project Ownership

As jointly announced on October 29, 2007, PhosCan and Baltic have agreed to merge to consolidate ownership of the Martison Phosphate Project. Upon completion of the proposed merger, PhosCan would own a 100% interest in the Martison Phosphate Project. The former Baltic shareholders will own common shares of PhosCan and common shares of a newly-formed company, Canadian Orebodies Inc., which will own all property interests of Baltic other than its interest in the Martison Project. PhosCan and Baltic are proceeding with the merger, which has been approved by both boards of directors and is subject to the favourable vote of shareholders. The merger is now expected to be completed in early March, 2008.

INFORMATION IN THIS NEWS RELEASE THAT IS NOT CURRENT OR HISTORICAL FACTUAL INFORMATION MAY CONSTITUTE FORWARD-LOOKING INFORMATION OR STATEMENTS WITHIN THE MEANING OF THE UNITED STATES PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 AND APPLICABLE CANADIAN SECURITIES LEGISLATION. IMPLICIT IN THIS INFORMATION, PARTICULARLY IN RESPECT OF STATEMENTS AS TO FUTURE OPERATING RESULTS AND ECONOMIC PERFORMANCE OF THE COMPANY, AND RESOURCES AND RESERVES AT THE COMPANY'S MINERAL PROJECTS, ARE ASSUMPTIONS REGARDING PROJECTED REVENUE AND EXPENSE, COMMODITY PRICES, AND MINING COSTS. THESE ASSUMPTIONS, ALTHOUGH CONSIDERED REASONABLE BY THE COMPANY AT THE TIME OF PREPARATION, MAY PROVE TO BE INCORRECT. READERS ARE CAUTIONED THAT ACTUAL RESULTS ARE SUBJECT TO A NUMBER OF RISKS AND UNCERTAINTIES, INCLUDING RISKS RELATING TO GENERAL ECONOMIC CONDITIONS AND MINING OPERATIONS, AND COULD DIFFER MATERIALLY FROM WHAT IS CURRENTLY EXPECTED. THE COMPANY DISCLAIMS ANY INTENTION OR OBLIGATION TO UPDATE OR REVISE ANY FORWARD-LOOKING STATEMENTS, WHETHER AS A RESULT OF NEW INFORMATION, FUTURE EVENTS OR OTHERWISE.

"The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release."

Contact Information

  • PhosCan Chemical Corp.
    Stephen Case
    President & CEO
    (416) 972-9222
    or
    Baltic Resources Inc.
    Don McKinnon
    President & CEO
    (705) 268-9000