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Highfield Resources To Focus On Spanish Potash Projects, Exits McLarty Project

Highfield Resources (ASX: HFR) will focus exclusively on its three wholly-owned potash projects in Spain after deciding to exit the farm-in to the McLarty Project, Western Australia.

The company's Javier, Pintano and Sierra del Perdón potash projects are located in the Ebro potash producing basin in Northern Spain.

It noted that assessment and exploration completed on these projects since their acquisition in October 2012 had been extremely encouraging.

Highfield added its decision to exit McLarty was after consideration and in consultation with Broadway Resources, which holds the project. Its 10% interest will be transferred back to Broadway.

The company had originally entered into a farm-in agreement with Broadway in November 2011 to explore three granted tenements in the Canning Basin.

Under the terms of the farm-in agreement the company received an initial 10% interest and a right to earn up to an additional 70% of the project through spending certain amounts, conducting a drilling program and the completion of an independent calculated JORC Resource.

Recent Spanish exploration

The initial drill hole of the four hole confirmatory program at Sierra del Perdón had intersected a thick layer of salt which looks to include potassium mineralisation of about 14 metres at depths of 396.05 to 410.05 metres below surface.

Visual inspection of the core indicates that the hole intersected a potassium bearing seam at around 396 metres below the surface extending to around 410 metres.

The seam appears to indicate some 9 metres of interbedded carnallite followed by a further 5 metres of interbedded sylvinite, and is consistent with the historical mining and drill hole data.

Highfield has also in August kicked off initial drilling at the Javier project which covers an area of about 20 square kilometres in Northern Spain.

This program will see the drilling of 11 holes over the coming three months.

Drill rigs will be shifted to the Javier project upon completion of the four-hole campaign at Sierra del Perdón. It is anticipated that there will be three rigs in operation at Javier by the end of August 2013.

The company is also preparing to start in the fourth quarter of 2013 an eight hole initial drilling campaign at the Pintano Project to complement the four existing drill holes that show mineralisation within the project area.

Sierra del Perdon includes two former operating mines. Highfield's objective is to quickly recommence production from these mines.

The Javier and Pintano potash projects are located in two separate sub basins within 60 kilometres of the former operating mine. Highfield owns a 100% interest in the five granted tenements with three applications pending that comprise the three projects and cover over 400 km2.

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