New legislation that would tax and regulate potash mining in North Dakota has prompted a surge of interest among investors and producers from around the world, state officials say.
Five people or companies have leased rights to mine the fertilizer ingredient beneath more than 4,000 acres of land in northwestern North Dakota. The state Land Department, which handles inquiries on state mineral leases, has been deluged with requests since the Legislature approved a 2% tax on potash mining last month.
"I've been getting a lot of calls with people asking, 'What's going on in North Dakota, and how can we get in on this deal?'" said Drew Combs, the agency's director of minerals management. "They've been coming from all over the world, especially Canada and the U.K., people just wanting information on how they might get involved."
North Dakota geologists estimate the state has about 50 billion tons of potash. New Mexico, Utah and Michigan were the only states to produce it last year, according to the U.S. Geological Survey. The three states accounted for less than 1 million tons of potash production in 2010.
Brad Fay, a Bismarck energy investor, leased almost 900 acres in April's auction. He said it's too early to guess how lucrative potash mining will be in North Dakota, but he's encouraged by the booming enterprise in Canada.
"You don't have to look too far north to see what's possible for the industry," Fay said. "I thought it would be interesting to be part of the play."
North Dakota Potash Deposits Attract Investor Attention
Source: Associated Press (5/16/11)