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Published August 16, 2010, 12:13 PM

N.D. issues first potash permit in decades

North Dakota has approved its first exploratory drilling permit in more than three decades for potash, a form of salt used for fertilizer.

By: James MacPherson, Associated Press

BISMARCK — North Dakota has approved its first exploratory drilling permit in more than three decades for potash, a form of salt used for fertilizer.

The state Department of Mineral Resources issued the permit Friday to Denver-based Dakota Salts LLC for one test well near Lignite in Burke County. The company is using grant money from the state to study whether the mines can be used to store compressed air for electricity-generating wind farms once the potash is removed.

Dakota Salts is a subsidiary of London-based Sirius Exploration PLC, which has mining interests in China, Australia and Macedonia. The company said it has leased more than 6,000 acres in northwestern North Dakota for salt and potash mining.

Toby Hall, a Sirius Exploration spokesman in London, said the 8,900-foot deep test well will be drilled by the end of the year.

Only four test wells have been drilled for North Dakota potash, the last in 1976, said Ed Murphy, the state geologist.

Besides storing compressed air, Dakota Salts says the mining caverns also could store carbon dioxide from North Dakota’s coal-burning power plants or natural gas from the state’s oil fields.

North Dakota’s Industrial Commission gave the company a $225,000 grant in April to study the ideas. Gov. John Hoeven, Attorney General Wayne Stenehjem and Agriculture Commissioner Doug Goehring make up the commission.

Murphy said North Dakota likely holds some 50 billion tons of potash. North Dakota’s potash beds, created by oceans that dried up some 400 million years ago, cover about 11,000 square miles in the northwestern corner of the state, he said.

About 90 percent of the potash used for domestic crop production comes from mines in western Canada, the U.S. Geological Survey says.

Some of the biggest mines in Canada are less than 150 miles north of North Dakota, Murphy said. The Canadian and North Dakota deposits are contiguous, though the potash in Canada is found at shallower depths and is easier to recover.

Canadian potash beds, which supply most of the world’s demand, are about 5,000 feet beneath the surface. North Dakota’s potash deposit ranges from 5,600 feet to about 12,000 feet underground, Murphy said. Three companies considered mining North Dakota potash in the 1960s and 1970s but believed it was too deep.

Potash is recovered by traditional mining and by solution mining, a process that involves injecting liquid in holes to dissolve and recover it. Dakota Salts intends to do the latter.

Advanced drilling techniques learned from the oil industry could help cheaply reach the potash at North Dakota’s deeper depths, Murphy said.

Hall said there is no timeline for North Dakota potash mining.

“Clearly, the first priority is potash exploration ... and the need to start proving it up with up-to-date data,” he said.