Andrew Racz
Director of Research
300 East 54 Street, Suite 26C
New York, NY 10022
Phone: (212) 319-6949
Fax: (212) 753-1944

Western Potash Corp.

May 12, 2008




Price Range:

$1.22 - 91¢

This company went public on May 6, 2008.

Shares offered:     46,000,000

Debt:      -0-


Undoubtedly, many factors depend on management. Their knowledge of the industry and their contacts with the related fields cannot at this stage be measured. However, if their attitude towards the industry is constructive, then this small company, Western Potash, with less than $100 million market cap, in contrast to POT, whose market value is $60 billion, offers the most leveraged but positive participation for the fertilizer industry. I hope history will confirm that the judgment of this scenario is affirmative.

Conclusion and Conceptual Recommendation

Western Potash (IPX.V) may turn out to be an unusual, highly speculative, but intriguing way to play the fertilizer industry.

Approximately 95% of all potash produced is used for agricultural fertilizer. Global population and income growth are driven by food demand and therefore fertilizer usage. Particularly in the developing world, increased consumption of meat requires large amounts of grain which require fertilizers. The world’s arable land per capita if anything declines.

The USDA report of May 10, 2008 is expected to show that, over all, the world grain supply/demand balance will remain in a deficit for 2008, which is bullish for future fertilizer demand.

Inventories of key crops are shrinking.

1. Barley dropped in inventory from 4 million metric tons in 1990 to 2 million in 1995.

2. Rice dropped from 150 million metric tons to 80 million.

3. Corn dropped from 200 million metric tons to 100 million.

Sharply rising prices pose problems for many millions except farmers. For instance, dairy product prices have increased from $2000 for a metric ton in 2006 to $5000 a metric ton in 2008.

The 21st century has changed the profile of our lives. The world’s population and their respective prosperity created a world where the standard of living has changed with increased meat consumption.

Table: World Meat Consumption


Million Tons











Table: Grain Required for Meat Production


Kg of grain needed to produce 1 kg of meat







These numbers represent basically our entire lifestyle except that the price of each agricultural commodity is growing every year.

At the heart of these problems are fertilizer prices, a commodity in limited supply and with limited potential for practical expansion for the next 10 years.

Western Potash’s Strengths

In addition to the favorable industry trends, Western Potash believes that the following strengths and factors will help achieve its business goals:

Mining Friendly Jurisdiction with Existing Infrastructure

Yearly production will be 9.7M tons in 2008, 12.7M for 2012, and 15.7M ton in 2015.

Western Potash (WPX) is the sole junior potash exploration company with a project located in Manitoba and one of only three companies, including BHP Billiton Limited and Agrium Inc., focused on the area. Mining is Manitoba’s second largest resource industry and as such, receives significant government support. In 2007, Manitoba was rated as having the best policy environment in the world for mining by the Fraser Institute. Centrally located, Manitoba is a key link in the mid-continent trade corridor. It has excellent access to Asia and Europe through its deep water port on Hudson’s Bay. The port of Churchill is nautically closer to ports in Northern Europe and Russia than any other port in Canada, and is a part of the closest shipping route between North America and Asia. Manitoba’s three rail connections to the U.S. Midwest provide ready access to one of the world’s largest potash markets.

Properties in Established Potash Producing Region

Western Potash’s property is located on the Devonian Prairie Evaporite, one of the world’s most prolific potash regions, which covers a significant portion of southern Saskatchewan and extends into the McAuley-Russell area of Western Manitoba.

Potash deposits in the prairie Evaporite are unique because they typically have very consistent thickness and grade across a wide lateral zone.

Due to the predictable and generally consistent nature of potash deposits in the Prairie Evaporite, it is possible to define a western Manitoba potash deposit with relatively few drill holes supplemented by seismic coverage to establish continuity between drill holes. For example, the production decision for Potash Corp.’s Lanigan mine was based on only 18 exploration drill holes and various seismic surveys.

Potash Corp.’s Rocanville potash mine, according to Potash Corp., one of the lowest-cost potash production facilities in the world, with a mineral reserve of 422 million tones grading 22.5% K2O, is located 25 km southwest from the centre of the Manitoba Potash Property (13 km from the edge of the Manitoba Potash Property). Historical drilling and seismic results on the Manitoba Potash Property show promising geological results—analysis of two drill holes, approximately 13 miles apart, has thus far revealed intersections of 13.5 feet at 18% K2O and 12.5 feet at 20% K2O. The Manitoba Potash Property is also adjacent to properties held by BHP Billiton Limited (164.67 million tones @ 24.5% K2O) and Agrium Inc. (750 million tones @ 21% K2O). See “The Manitoba Potash Property—Introduction.”

Well Financed, Potash-Focused Public Company

Before giving effect to the Offering, Western Potash has approximately $50M cash on its balance sheet, increasing to approximately $70M, after the exercise of warrants and options, subsequent to the closing of the Offering. The strong cash position will allow the Company to aggressively advance exploration of the Manitoba Potash Property on an accelerated time frame. Accordingly, the Company provides a unique opportunity to invest in a nimble junior public enterprise focused solely on exploring for potash in Manitoba.

Use of Proceeds

The net proceeds to the Company from the Offering, after the payment of all costs in respect of the Offering, are estimated to be $50M. The net proceeds of the Offering together with the proceeds from prior sales of Common Shares are expected to be used as follows:


Maximum Offering

Phase I exploration program




Phase II exploration program (1)




Administrative costs




Unallocated working capital










(1)  Contingent on results of Phase I exploration program.

The Tiny Western Potash in the Total Picture

WPX has the second largest potash reserve in Manitoba. Centrally located, Manitoba is a key link in the mid continent trade with access to Asia and Europe. It has first rate access to the United States with rail concessions. The most important potash mines are listed in the table below 

Table A: Saskatchewan Potash Mines


Vanscoy – Agrium


Cory – PotashCorp.


Patience Lake – PotashCorp.


Allan – PotashCorp.


Colonsay – Mosaic


Lanigan – PotashCorp.


Belle Plain – Mosaic


Esterhazy K1 – Mosaic


Esterhazy K2 – Mosaic


Rocanville – PotashCorp.


Burr* - Athabasca Potash


Jansen Lake* - Anglo Potash

* Potential mines subject to feasibility and financing.

While it would take 5 years to bring WPX to commercial production, it is part and parcel of the global picture. Estimated cost is $3.0 billion

Table B: Global Potash Fertilizer Use by Crop – 2006/2007

World Potash Reserves
(Billions Tones K2O2, Percentage of Global Reserves)

The price of potash meanwhile is growing rapidly. Effective June 1, 2008, the price range will be between $150 to $175. A recently signed contract with India was priced at $355, and with China at $400. Current contracts for future delivery are priced at $725. In this potash-inflated world, when we take into account the world’s population grows, the conclusion must be reached that unless 50-100% increase in arable land can be achieved, the demand for current and future production can increase dramatically.

World population was 2.5 billion in 1950, 6 billion in the year 2000, projected to reach 7 billion in 2010, and 9 billion by 2050. The production forecast for major producers appears in Table C.

Table C: Potash Supply by Major Suppliers








Potash Corp.





















Israel Chemicals














I, we accept the theory that Western Potash has arable potash-producing land, and we can assume that in 5 years time it will produce potash, then the stock is the depository of many positive—if hypothetical—factors.

There are various possibilities.

1. Any of the food hungry nations can buy into Western Potash and provide capital for accelerated development.

2. Any of the large currently producing companies would buy 100% of Western Potash simply to reproduce its reserve position on the future.

3. The potash demand would value in the second or third year the underlying potential for potash producing capability of Western Potash, which means meaningful appreciation of the stock price and the conversation of yet unissued stock into cash. 

Undoubtedly, many factors depend on management. Their knowledge of the industry and their contacts with the related fields cannot at this stage be measured. However, if their attitude towards the industry is constructive, then this small company, with $100 million market cap, in contrast to potash corporations market value of $60 billion, offers the positive outlook the judgment of the prospect in the affirmative.


Information contained herein is based on data obtained from recognized statistical services, issuers reports or communications or other sources believed to be reliable. However, such information has not been verified by us and we do not make any representation to its accuracy or completeness. Any statement non-factual in nature constitutes only current opinions which are subject to change. BERAL INC. or their officers, directors, analysts or employees may have positions in the securities or commodities referred to herein, and may as principal or agent buy and sell such securities or commodities. An employee, analyst, officer or a director of BERAL INC. may serve as a director for companies mentioned in this report. Neither the information nor any comment expressed shall constitute an offer to sell or a solicitation of an offer to buy any securities or commodities mentioned herein. There may be instances when fundamental, technical and competitive opinions may not be in concert. This firm may from time to time perform investment banking or other services for or which investment banking or other businesses from any company mentioned in this report.



Bunker Hunt Article
Posted October 27, 2014

Lamb Realty.
Posted October 15, 2014

Chiquita Brands International
Posted August 20, 2014

Emerson Radio
Posted August 24, 2014

Evercore Partners Inc.
Posted August 5, 2014

Moelis & Co.
Posted July 22, 2014

Torchlight Energy Resources, Inc.
Posted May 21, 2014

Andrew Racz
Posted May 19, 2014

Royal Nickel Corporation
Posted May 02, 2014

Recorded Interview Robert Schermer, CEO
Posted March 15, 2014

Cowen Group, Inc.
Posted March 5, 2014

Pacific Booker Minerals Inc.
Posted February 4, 2014

Sandstorm Gold Ltd
Posted January 24, 2014

Global X Gold Explorer ETF
Posted January 16, 2014

Bring Back Mr. Giuliani
Posted December 24, 2013

Gold Reserve Inc.
Posted October 15, 2013

Premier Diagnostics Health Services Inc.
Posted September 25, 2013

Almaden Minerals
Posted September 3, 2013

Electric Cars In New York City
Posted August 27, 2013

The World Without Gold
Posted July 2, 2013

Remembering Mr. Churchill
Posted June 10, 2013

Financial Transactions in the Digital Age
Posted May 15, 2013

Senator Chester Crandell ( R ) Arizona
Posted May 7, 2013

Explor Resources Exs V
Posted April 14, 2013

The Gathering Storm
Posted April 9, 2013

Vietnam - West of Hong Kong
Posted March 11, 2013

Vietnam – In Peace!
Posted February 26, 2013

Wisdomtree Investments Inc
Posted January 28, 2013

Explor Resources Inc.
Posted November 28, 2012

Oremex Silver Inc.
Posted September 18, 2012

Alphamin Resources Corp.
Posted July 26, 2012

Harvest Natural Resources
Posted July 20, 2012

The Man Who Was Created by Gold
Posted July 06, 2012

Recorded Interview With Zach Erdem, President
Posted June 20, 2012

Nortec Minerals Corp.
Posted May 01, 2012

The Fundamentals of Chesapeake Gold Corporation
Posted April 16, 2012

Jourdan Resources Inc. (JOR.V)
Posted March 20, 2012

Posted February 27, 2012

Gold Index Bonds - To Avoid the Money Traps
Posted February 2, 2012

Monarch Casino & Resort, Inc.
Posted February 01, 2012

QMC Quantum Minerals
Posted january 19, 2012

African Metals Corp.
Posted December 21, 2011

The Crisis That Almost Wasn’t
Posted December 7, 2011

Posted November 18, 2011

The Crisis That Almost Wasn't
Posted November 15, 2011

Ocean Power Technologies, Inc
Posted October 19, 2011

The Mongolian Economic Miracle
Posted October 12, 2011

H. Hunt
The Son of Bunker Hunt
Posted August 24,2011

Sandstorm Gold
Posted August 15, 2011

"Silver At $200
Posted July 29, 2011

"First Majestic Silver Corp
 Posted July 26, 2011

"Interview with Brian Kirwin,
American Bonanza Gold Corp"

Posted July 21, 2011

"Interview with Ian Foreman
Yale Resources Ltd."

Posted June 16,2011

"Interview with Brandon Mckee
Callinan Mines
By Andrew Racz "

Posted June 1, 2011

"Andrew Thompson Interview Soltoro Ltd."
Posted May 15, 2011

"Great Panther Silver Limited"
Posted March 29, 2011

"The 21st Century's Marshall Plan"
Posted March 17, 2011

"Interview With
Houston Hunt"

Posted February 23, 2011

"Esperanza Resources Corp."
Posted February 23, 2011 

"Douglas Lake Minerals"
Posted January 11, 2011 

"Do not bet against Casablanca"
Posted December 10, 2010 

Posted December 8, 2010 

"Full Circle"
Posted November 19, 2010 

Posted November 8, 2010 

SilverCrest Mines, Inc.
Posted October 26, 2010

Cache Exploration, Inc.
Posted October 22, 2010 

Silvore Fox Minerals Corp.
Posted September 29, 2010 

Almaden Minerals, Ltd.
Posted August 16, 2010 

"The Path Of A Hungarian Immigrant"
Posted August 12, 2010 

"Interview With
Mark Hazout -
Silver Dragon Resources

Posted June 24, 2010

"Who Owns Whom At The Final Tally"
Posted June 15, 2010 

"The World Needs
Bunker Hunt.

Posted May 24, 2010 

"Arafura Resources "
Posted April 15, 2010 

"MF Holdings LTD"
Posted April 7, 2010 

"Quest Uranium Corporation"
Posted April 5, 2010 

"Lynas Corporation, LTD"
Posted March 19, 2010 

"Rare Element Resources LTD"
Posted February 9, 2010 

"Mexco Energy Corporation"
Posted January 4, 2010 

"Claude Resources"
Posted December 16, 2009

"The Silver Spirit"
Posted November 25, 2009 

"... from Casablanca to Monte Carlo."
Posted November 20, 2009 

"Sutter Gold Mining, Inc."
Posted November 16, 2009 

"Whose Friends Are They Anyway?"
Posted November 4, 2009

"U.S. Energy Corporation"
Posted October 28, 2009 

"Harris & Harris"
Posted October 13, 2009

"They Made A Difference"
Posted September 30, 2009 

"Bridge Bancorp, Inc"
Posted September 22, 2009 

"Entree Gold - September 2009"
Posted September 3, 2009 

"Who Lost Mongolia"
Posted August 16, 2009 

"Mongolian Prime Minister Sanj Bayar -
A politician of the 21st century"

Posted July 16, 2009 

"Romios Gold"
Posted July 7, 2009 

"The Grand Alliance"
Posted July 6, 2009 

"Sandstorm Resources, Inc."
Posted June 22, 2009 

"Ireland, Inc."
Posted June 16, 2009 

"The Brave New World! - Gold at $1000"
Posted June 5, 2009 

"Claude Resources, Inc."
Posted May 28, 2009 

"Bullion Management Group"
Posted May 11, 2009

"Golden Hope Mines, Inc. - Retraction"
Posted May 4, 2009 

"Silvercrest Mines, Inc."
Posted April 1, 2009 

"Silver Dragon Resources"
Posted February 27, 2009

"In Gold We Trust"
Posted February 26, 2009

"Entree Gold: An Unusual Asset Accumulation"
Posted February 20, 2009 

"The Ultimate Colorful Fate of Edmond Safra, Bernie Madoff, and Governor Bill Richardson"
Posted January 12, 2009

"Silvermex Resources, LTD"
Posted December 13, 2008 

"Prime Minister of Mongolia"
Posted December 11, 2008 

"US Gold Corporation"
Posted December 1, 2008 

"Rubicon Minerals"
Posted November 5, 2008 

"Gold Coins & The Money Game"
Posted October 29, 2008 

"Gold and the Chinese Millennium"
Posted October 20, 2008

"JNR Resources, Inc."
Posted September 30, 2008

"Three Immigrants In Front Of The Court"
Posted September 24, 2008 

Walter J. Hickel Interview"

Posted September 11, 2008

"The Alaskan Queen"
Posted September 9, 2008 

"Evercore Partners, Inc."
Posted September 3, 2008 

"Stalin In The
White House"

Posted September 2, 2008 

"Cal-Maine Foods Inc."
Posted August 4, 2008 

"The Mongolian Revolution"
Posted July 10, 2008 

"Mongolian Newsletter, First Edition"
Posted July 2, 2008 

"Goldsource Mines, Inc."
Posted July 1, 2008

"The Douglas Lake Story In The Age Of Fear"
Posted June 25, 2008 

"Mongolia: The 10th Richest Country in the World"
Posted June 10, 2008 

"North American Gem, Inc."
Posted June 5, 2008 

"The Emergence of Tanzania"
Posted June 4, 2008

"Tanzania - An Up & Coming Mineral & Agricultural Producer In Africa"
Posted June 2, 2008

"Western Potash Corp.

Posted May 12, 2008 

"Judy Garland &
The Subprime Crisis"

Posted April 29, 2008 

"Altek Power Corp."
Posted April 27, 2008 

"Letter to Prime Minister of Mongolia"
Posted April 24, 2008 

"The Mongolian Manifesto"
Posted April 4, 2008 

"Prime Minister Sanj Bayar of Mongolia Receives The Nobel Peace Prize"
Posted March 17, 2008 

"Olympus Pacific Minerals, Inc."
Posted February 28, 2008 

"Tanzania Gold - Douglas Lake Minerals - Harp Sangha"
Posted February 21, 2008

"Warren Buffett Receives A Call From Franklin Roosevelt"
Posted February 19, 2008

"Gold At 2000!!"
Posted February 14, 2008

"Entrée Gold, Inc"
Posted February 11, 2008

"The Unexpected
Mongolian Dilemma"

Posted February 2, 2008 

"Mongolian Gold"
Posted January 8, 2008

"Sir, Do Not Abdicate"
Posted December 27, 2007

"No More Munich -
The Mongolian Version of 1938"

Posted December 11, 2007

"Watergate Saved Nixon's Life"
Posted November 28, 2007

"The Mongolian Wakeup Call"
Posted November 16, 2007 

"Sanj Bayar -
The Prime Minister of Mongolia"

Posted November 15, 2007 

"Stalin & Chavez"
Posted November 9, 2007 

"Tagish Lake Gold Corp."
Posted November 1, 2007 

"Gold Indexed Bonds"
Posted October 11, 2007

"Jasper Mining Corporation"
Posted September 27, 2007

"Ghengis Kahn Returns"
Posted September 27, 2007

"Interview with Professor William Pfaffenberger - Torch River Resources"
Posted September 22, 2007 

"Interview with
Jim Davis - President of Leeward Capital Corporation"

Posted September 4, 2007 

"Interview with
David Hjerpe - Newmac Resources, Inc."

Posted August 27, 2007 

"The Age of Special "Corporate" Relationships"
Posted August 23, 2007

"Entrée Gold Inc."
Follow Up Report #1

Posted July 24, 2007

"Aldershot Resources Ltd."
Posted July 16, 2007 

"Portal Resources"
Posted June 12, 2007 

"Ghengis Kahn Was Hungarian"
Posted May 31, 2007

"Bayswater Uranium Corp."
Posted May 30, 2007 

"Brilliant Mining Corp."
Posted May 22, 2007

"Golden Valley Mines, Ltd"
Posted April 21, 2007

"Warren Buffett - Franklin Roosevelt"
Posted March 15, 2007

"Rubicon Minerals Corp."
Posted March 1, 2007

"Robert Friedland -
The Man of The Year"

Posted February 21, 2007

"Lexam Exploration, Inc."
Posted February 11, 2007

"My Father Died In Auschwitz"
Posted January 19, 2007

"WisdomTree Investments, Inc."
Posted December 26, 2006

"Entrée Gold Inc."
Posted December 13, 2006

"Aero Mechanical Services, Ltd"
Posted November 17, 2006

"This Year I"m Voting For Dick Nixon"
Posted November 7, 2006

"Global Options
Group, Inc."

Posted November 1, 2006

"The Arrival of the
Nickel Billionaires"

Posted October 18, 2006

"The Kennedy-Nixon debate revisited"
Posted October 4, 2006

"Brilliant Mining Corp."
Posted September 17, 2006

"A Matter of Reasonable Doubt"
Ken Lay - Enron

Posted August 30, 2006

"Silver Wheaton - SLW"
Posted August 28, 2006 

"Silver In The
Twenty-First Century"

Posted August 16, 2006

"The Age of Mediocrity"
Posted July 19, 2006

"Let There Be Sunshine"
Kirk Kerkorian

Posted July 12, 2006

"Oil & Gas
Energy Crisis Solution"

Posted July 3, 2006

"I Am An Immigrant!"
Posted June 7, 2006

"Northern Star
Mining Corp."

Posted May 19, 2006 

"Gateway Gold:
It"s A Gold Story"

Posted May 15, 2006

"Ken Lay's Legacy"
Posted May 8, 2006

"The Principal Guest Was Missing"
Posted April 25, 2006

"J.P. Morgan Offers Advice To Ken Lay"
Posted April 11, 2006

"Pocketful Of

Posted April 8, 2006 

"Midway Gold
Posted March 23, 2006 

"Harvest Gold"
Posted March 2, 2006 
"Sparton Resources"
Posted March 1, 2006 

"Interview with
Robert McEwen-
U.S. Gold Corporation
Posted February 22, 2006 

"A Tribute to
Rudy Giuliani
Posted February 15, 2006
"Your Money Is Not Yours"
-Enron & Martin Siegel, Esq.

Posted February 9, 2006

"Other People"s Money -Enron & Martin Siegel, Esq."
Posted January 28, 2006

"Northern Star Mining"
Posted January 16, 2006 
"Sonesta International Hotels Corporation"
Posted December 29, 2005 

"The Currency of Mass Destruction"
Posted December 5, 2005
"Bunker Hunt-Silver-China"
Posted November 28, 2005

"50 Relatives Worse Than Yours"
Posted November 14, 2005

"Then And Now"
Posted November 9, 2005 

"The Business of Hungary is Business!"
Posted October 31, 2005

"Mr. Prime Minister"
Posted October 13, 2005
"U.S. Gold Corp."
Posted September 29, 2005

Posted September 23, 2005

"Mr Clarke -
Call In The Boys"

Posted September 12, 2005
"A Letter To
President Bush"

Posted September 8, 2005

"Mr. Smith Goes To Hungary"
Posted September 1, 2005
"Orko Gold"
Posted August 18, 2005

 "Near Hit"
Posted August 16, 2005

"An African Queen"
Posted August 11, 2005

"1848 and Beyond"
Posted August 4, 2005



Andrew Racz. 300 East 54 Street, Suite 26C, New York, NY 10022
Phone: (212) 319-6949 Fax: (212) 753-1944. E-mail:

Copyright © 2011 Andrew Racz. All Rights Reserved.