Ivanhoe’s Kipushi zinc mine in the DRC officially reopens
The restart marked exactly a century since the mine first went into production.
Stock boards were buzzing on Tuesday as traders tried to figure out why Western Potash Corp. was soaring 18.2% without any news about the $200 million firm that would drive the share higher.
Despite having nothing to go on, speculators had swapped 2.3m shares by 3pm in Toronto, 1.5 times usual volumes. The junior player in Saskatchewan’s potash industry is in the pre-feasability stage of its Milestone Project where it hopes to mine 940 million tonnes of potash using the solution method, but some doubt if WPX would be able to muster the finances and logistics to go up against the giants operating in the province.
Western Potash (TSE:WPX) listed on the venture exchange in May 2008 and graduated to the TSX main board on 12 July with 160,945,183 common shares outstanding in the Mining category. Tuesday’s move up was not enough for Western Potash to get out of negative territory and it is still trading down over 15% since moving to the TSX main board.
Traders called for the usual suspects – that the move in the stock was the work of an insider who’s not sharing a piece of good news or an imminent announcement of a takeover. WPX may be actively looking for a big partner as going it alone would probably be too much to bite off.
Others believed the jump could be because another Saskatchewan potash wannabe delighted the market the day before. On Monday, Karnalyte (TSE:KRN), added 10% after releasing a positive feasibility study and 43-101 technical report, but by Tuesday its rally had run out of steam and it shed 0.7%. The $354 million company has doubled since the start of the year.
At the time of WPX’s TSX listing some were wondering whether the company (and by extension players like Karnalyte) is being run off the rails by the big players in Saskatchewan and Robert Winslow, an analyst at Wellington West Capital Markets argued:
“In our view, Western Potash’s prospects are increasingly challenged as greenfield mine resources become more scarce with the larger, well-financed competitors securing the equipment, logistics capacity, and labour needed to bring new production to market.”
World number one potash company Potash Corp of Saskatchewan (TSE:POT) gave up 3.4% on Tuesday and is down just over 10% for the year.
Image by Daniel DeSlover / Shutterstock.com
