The DICTUC study of the geology and hydrology of the Salar de Llamara basin led to the definition of an upper saline aquifer located between approximately 745 and 645 m.a.s.l. and a deeper saline aquifer of varying thickness located between an elevation of approximately of 645 and 300 m.a.s.l. The upper aquifer has been intensely explored by drilling, sampling and confirmatory TEM surveys while the deeper aquifer geophysical surveys have been tested by deep drilling in a few locations only.
Potash Dragon has validated the published sampling results obtained by the many scientific institutions for the surface and near surface aquifer. Potash Dragon has also duplicated and confirmed the TEM geophysical results relevant to the Properties.
Genesis of the Evaporite Minerals
The Pampa has been a basin for the deposition of non-marine sediments derived from the uplifting Andes to the E for much of the Neogene. The Cordillera de la Costa has blocked westward coastwise drainage of the Pampa until the relatively recent breakthrough to the coast of the Rio Loa canyon. Prior to the overspill and development of the Loa canyon the Pampa was characterized by a huge lagoon of ponded Andean drainage, Lago Soledad, lying above the sedimentary fill of the Pampa including the Salar de Llamara. Prominent terraces with salt deposits marking high former lake levels occur around Cerro Soledad. The Tertiary continental sedimentary rocks in the Pampa are fluvial, lacustrine and evaporitic and the gypsiferous succession includes diatomite and highly soluble, but crystalline residues such as halite, associated potassium salts and, superficially, nitrates. These minerals were deposited following evaporation, particularly of Lago Soledad, in the hyper arid climate. Interspersed in this succession are horizons of volcanic tuff from eruptions in the Andes to the E. The sequence is estimated to be up to 1,000 m thick and has been shown to be 930 m thick in the drill hole Hilaricos No. 1, which is located on Potash Dragon's southernmost property.
Continuous monitoring, geochemical sampling data, backed up by the public disclosure of independent assay certificates, for the upper aquifer, have been reported. Quarterly sampling of the aquifer since May 2010 reveals that the total dissolved solids ("TDS") contained within the aquifer at a point vary between 3800 mg/L and 4200 mg/L.
The flow of the aquifer has been modelled and published. Flow directions of the aquifer are to the west and south towards puquios (small ephemeral lakes) that represent doline features within the karst (solution) topography where the aquifer becomes exposed on surface due to the dissolving of soluble salts. A north west - south east puquio trend extends over a distance of 21 km from the north west sub outcrop of the upper aquifer to its south east exposure. The zone of puquios effectively delineate the outcrop of the uppermost halite unit of the Soledad Formation which has an average west - east lateral width of approximately 5 km across the strike length of 21 km.
Potash Dragon has conducted seasonal validation sampling of the waters of the upper aquifer which show dramatic increases in the concentration of TDS within the puquios to between 100,000 to 230,000 mg/L through a combination of dissolution and evaporation. Sampling of a borehole located to the east of the intersection of the upper aquifer with the south east puquios shows a fourfold increase in TDS from between 3800 mg/L and 4200 mg/L to between 12,000 mg/L and 17,000 mg/L TDS.
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