pebble creek applies for permits to explore po

Vancouver, British Columbia, and New Delhi, India – July 29, 2008 – Pebble Creek
Mining Ltd. (“Pebble Creek” or the “Company”) is pleased to announce that the state
government of Rajasthan, India has accepted the Company’s applications for
Reconnaissance Permits in the Nagaur-Ganganagar Basin on July 25, 2008. The state
government advises that the applications will be vetted in a timely manner. Potash
applications do not require secondary approval by the central Indian government.
The basin is located in the desert of northwestern Rajasthan and occupies 100,000
square kilometers. Within the basin are nine smaller evaporite sub-basins. Evaporites
are mineral salts that precipitated in brine pools as the seawater evaporated.
The Geological Survey of India (“GSI”) conducted geophysical studies and drilled 72
holes totalling 61,700 metres in the sub-basins from 1974 to 1991, and reported the
results in Special Publication No. 62. The Company has reviewed GSI’s descriptive
work, which is summarized below.
The basin contains clastic and carbonate formations dating from late Proterozoic
through Cambrian ages, then Carboniferous through Jurassic, and finally Tertiary and
Quaternary. In the middle of the stratigraphic sequence the Hanseran Evaporite
Group has an aggregate thickness of 100 to 656 metres. The Hanseran contains seven
cycles of halite (sodium chloride) formations at depths of 300 to 1,200 metres below
the surface. It is considered “Eocambrian” age, or approximately 940 to 600 million
years old.
The various halite cycles in the Nagaur-Ganganagar Basin range in thickness from
several metres to 272 metres, generally thicker in the centres of the sub-basins. A
cycle generally has a thick halite bed, with potash beds at or near the top. The cycles
are numbered 1 to 7 upward from the base, and the highest grade potash is generally
found near the tops of cycles 2, 3 and 5.
Potash is a general name for salts containing potassium. The most common in this
series are polyhalite, sylvinite, sylvite, langbeinite and carnallite. At the Nagaur-
Ganganagar Basin, polyhalite beds range from 5 cm to 27 metres in thickness and
contain from 0.1 to 10.2% potassium. Sylvite beds range in thickness from 10 cm to
4.3 metres and contain from 0.2 to 22.75% potassium.
Pebble Creek Mining Ltd. 302-750 West Pender Street
Vancouver, BC, Canada V6C 2T7
Tel. +1 604 696 6101
Fax +1 604 696 6196
Email [email protected]
Web site www.pebcreek.com
TSX-V: PEB, FRANKFURT: BHB
The Company’s Reconnaissance Permit applications are in three non-contiguous
tracts of 2,000 square kilometers each, covering seven of the nine sub-basins (the
Satipura, Bharusari, Lakhasar, Arjunsar, Jaitpura, Malkisar and Hanseran sub-basins).
The Satipura, Bharusari and Lakhasar sub-basins were reported by GSI as having the
highest grades and thickest deposits, with potash beds found mainly between depths
of 505 and 750 metres. The sub-basins range in diameter from about 1,000 to 3,000
metres.
During the course of its research GSI estimated an historic mineral resource. Details
can be found in GSI Special Publication No. 62, 2005, Kolkata, 700016, India. GSI
provided a historic estimate of “probable” potash of 404 million tonnes containing
4.60% potassium, half of which is in Satipura and the remainder in Bharusari and
Lakhasar. The historic estimate was based on a minimum bed thickness of 1.5 metres
and a cutoff grade of 3% elemental potassium. GSI also provided a “possible”
estimate of potash in all three aforementioned basins of 2,070 million tonnes
containing 4.60% potassium. No mention was made of prospective mining methods
or loss of material left behind as pillars.
The historic estimates were prepared prior to National Instrument 43-101 (NI 43-101)
and were based on 72 drill holes covering an area of approximately 50,000 square
kilometers in an uneven pattern, with some holes located 1 or 2 km apart and others
scattered at greater distances. In addition GSI reported that some of the more soluble
potash salts dissolved in the drilling fluids and the resultant grade estimates could be
biased.
A qualified person has not done sufficient work to classify the historical estimates as
current mineral resources. The Company is not treating the historical estimates as
current mineral resources within the meaning of NI 43-101 and therefore, the
historical estimates should not be relied upon.
Although Pebble Creek does not endorse the historical estimates, the studies
conducted by GSI suggest that further exploration in the areas is warranted.
About India. India presently produces no potash. For several decades India was a
socialist country that had little profit-oriented mineral exploration and mine
development. Pebble Creek believes that India is the least explored of any country
occupying a mineral-rich Precambrian shield.
India is purchasing potash under yearly contracts from other countries, including
Canada, the world’s leading producer. A recent annual contract increased the price to
the equivalent of US$530 per tonne FOB Vancouver.
India’s annual growth rate has been 9% in recent years and its potash imports are
keeping pace. The Company believes the time is right to explore the Nagaur-
Ganganagar Basin for commercially viable potash.
India has three levels of mineral tenure: Reconnaissance Permit (“RP”), Prospecting
Licence (“PL”) and Mining Lease (“ML”). An RP is valid for three years and after
two years it must be reduced to the lesser of 50% of the subject area or 1,000 square
kilometers. The RP holder can drill up to 10 holes per 100 square kilometers of area.
The holder of an RP has preferential rights under existing law to obtain a PL on part
of that area. A PL is generally limited to 25 square kilometers unless the applicant
can substantiate that more area is needed for workmanlike exploration. The term of a
PL with extensions is five years. Unlimited drilling and testing can be performed.
The holder of a PL has preferential rights to obtain an ML, which has a term of 20 or
30 years and can be extended in 20 increments. An ML is generally limited to
10 square kilometers unless, as above, the applicant can substantiate the need for a
larger area.
India has been working towards a New Mining Policy for three years, which has now
been cleared by the cabinet and is awaiting implementation by Parliament. Once the
policy becomes law, the right to convert an RP or PL to the next higher level will
become absolute instead of preferential, size limits of tenures will increase under
certain conditions and other reforms in favor of the mining industry will take effect.
As reported widely in the world press, on July 22, 2008 the Congress Party’s coalition
government won a no-confidence vote in Parliament and emerged in a stronger
position to pursue its reform agenda. This bodes well for the mineral industry in India
which many have considered to be over-regulated.
Andrew Nevin, P.Eng., President and Chief Executive Officer of the Company, is the
qualified person under NI 43-101 who reviewed but has not verified the historic data
contained in this news release. He did verify locations of ten drill holes in five of the
sub-basins by finding the steel collar pipes cemented in the holes. Dr. Nevin has
approved of this news release.
About Pebble Creek. The Company has been exploring in India since 1995 and has
built up a technical and business infrastructure. The Company’s main project is the
Askot massive sulphide deposit in Uttarakhand state; however it maintains an active
pipeline of other projects in the exploration stages.
On behalf of the Board,
Gyan C. Singhai, P.Eng.
Executive Chairman
For further information, please contact:
Gyan Singhai, Executive Chairman
Telephone: 1 604 696 6101
Mike Romanik, Investor Relations
Verenex Capital Corp.
Telephone: 1 204 724 0613
The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this
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