RESPEC Mining & Energy Quarterly Newsletter: November 2021

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RESPEC Mining & Energy Quarterly Newsletter November 2021

under the surface: solution mining edition

Table of contents A MESSAGE FROM RESPEC

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NEWSROOM

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» Brine Production Caverns » Developing Innovative Drilling and Completion Techniques for CanPacific

» Advising on Acquisitions Exceeding $5 Billion in Salt Production

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GROWTH AND PEOPLE » RESPEC Gains a Grand Junction Office

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SAFETY » Nitroglycerin Exposure in Blasting Operations

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PRESENTATIONS » Transient Heat Transfer Analysis and Temperature Modeling for Solution Mining Caverns » Cavern Thermodynamics

CALENDAR OF EVENTS

» Underground Hydrogen Storage: What Are The Challenges? » Geomechanics of Cavern Storage

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November 2021 RESPEC M&E Newsletter

A message from RESPEC

I am pleased to share this RESPEC M&E quarterly newsletter, which focuses on everything solution mining. Over the past several years, the M&E team has been building capacity in salt and potash solution mining. From designing innovative, selective horizontal potash solutions to troubleshooting salt-brine operations to ensure a suitable feed for their plants, RESPEC provides custom services to tackle our clients’ most challenging problems. I would like to welcome our new team, which will be operating out of Grand Junction, Colorado, and is featured in this edition. The team brings nearly 30 years of solution-mining experience and will offer our clients geological, drilling, and engineering services.

We have also combined our experience in solution mining, geomechanics, and drilling outside of salt and have been developing unique solutions for borate, trona, and uranium projects throughout North America. Our solution-mining experts have been working with our Data & Technology Solutions team to develop custom software applications to help operators manage cavern assets and enhance reporting procedures. We are truly becoming a full-service provider for our clients in exploration, development, and operational optimization.

As global mining companies focus more on environmental, social, and governance (ESG) strategies for operations, companies are seeking ways to reduce their carbon footprint and environmental impact. Our cavern engineering team has been working on North American hydrogen and compressed-air energy storage (CAES) projects with caverns developed in the vast salt deposits in Alberta and Saskatchewan, Canada, along with many parts of the United States. Our nearly 60-year history of designing and storing nuclear waste for the U.S. government in salt deposits is a testament to the quality and safety of the structures that we design. Our engineers now provide these services to our clients to achieve their ESG goals.

I hope that you enjoy this information-packed issue dedicated to the commodities that built our company—salt and potash—and how those commodities are evolving.

Tabetha Stirrett

Co-President, RESPEC Canada

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November 2021 RESPEC M&E Newsletter

NEWSROOM

brine production caverns In a Challenging Geological Setting in Mexico

For more than 10 years, RESPEC has been a trusted advisor for a salt solution-mining operator in Mexico. Our engineers and scientists have assisted in locating and developing brine-production caverns in a challenging geological setting where the salt strata contain complex evaporites with varying solubilities and numerous nonsalt interbeds.

RESPEC has identified ideal cavern locations and salt strata to ensure high salt concentrations, maximize salt-extraction ratios, and maintain cavern performance. The following paragraphs provide a high-level discussion on some of the tasks that RESPEC performed to meet our client’s solution mining objectives: » Determine Solution-Mining Interval: The characteristics of an ideal cavern interval include high-purity salt and a relatively homogeneous salt structure with limited nonsalt interbeds; however, the geological setting at this operator’s site is challenging because the salt strata contain evaporites that consist of potassium, magnesium, and calcium and result in unfavorable brine quality and sodium chloride concentrations. The salt strata also contain several nonsalt interbeds, which increases the chance of poor leaching behavior and cavern instability. RESPEC developed and analyzed a suitable geophysical-logging and coring program to recommend ideal solutionmining intervals that successfully achieved high salt-extraction ratios, high salt concentrations and fewer impurities, and cavern stability. » Solution-Mining Design: RESPEC designed solution-mining programs to ensure that the operator would achieve the extracted salt concentration and quantity targets while also ensuring adequate cavern shapes with minimal

well workovers. The key parameters considered in the solution-mining design included the flow rate, leaching duration, tubing depth, leaching circulation method (i.e., direct and reverse circulation), rock mineralogy, and targeted salt-extraction amount. » Leaching Program Review: RESPEC performs monthly leaching program reviews to ensure that the solution mining and brine production are performing to plan and advise on adjustments needed to the leaching program. In the leaching reviews, our engineers and scientists conduct comprehensive analyses of flow rates, fluid pressures, salt-extraction tonnage, and concentrations of extracted minerals. These leaching reviews allow RESPEC to promptly detect and mitigate any abnormal solution-mining behavior that could signal operational and stability issues. » Workover Recommendations: RESPEC assists the operator in determining the well workover schedule and activities that need to be performed during the workover. Our scientists and engineers recommend a typical workover routine that includes sonar surveys, geophysical logs, cutting tubing, raising the diesel blanket, and switching circulation methods (i.e., direct and reverse circulation). The recommended workovers ensure that the solution mining continues with high performance and minimal issues.

For detailed information, please contact RESPEC’s Jai Duhan, Staff Engineer, Jai.Duhan@respec.com

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November 2021 RESPEC M&E Newsletter

NEWSROOM

developing innovative drilling and completion techniques for canpacific Economic Solution Mining of 400-Million-Year-Old Potash The CanPacific Potash Inc. (CanPacific) Albany project is located southeast of the Saskatchewan, Canada, capital city of Regina. CanPacific has proposed a 3-million-tonne-peryear potash solution mine that targets the Prairie Evaporite Formation within the Elk Point Basin. The CanPacific potash lease is geologically situated where the three potash members of the Prairie Evaporite Formation are present: Patience Lake, Belle Plaine, and Esterhazy. Saskatchewan hosts seven conventional potash mines and three potash solution mines and possesses the largest potash resources in the world.

The Albany project is in the southernmost part of the potash belt at a depth of approximately 1,500 metres where the temperatures are suitable for economical potash solution mining. RESPEC’s involvement in the Albany project began in 2016 when we designed a drilling program for a characterization borehole. Since then, RESPEC has drilled two additional exploration boreholes, defined the mineral resource, and completed National Instrument 43-101 technical reports. We also designed the drilling for a disposal well in summer 2021. The pilot test is scheduled sometime in the first half of 2022.

Map Showing Potash Mine Locations. The CanPacific Albany Project Subsurface Mineral Lease KL262 within Saskatchewan, Canada, is highlighted in yellow.

CanPacific has been working closely with RESPEC during the last 3 years to develop innovative drilling and completion techniques that will minimize the surface footprint, reduce water consumption, and leave tailings in the ground. We pride ourselves in our long-standing relationship with the CanPacific team, and we look forward to the next exciting phase of this project.

For detailed information, please contact RESPEC’s Abigail Martin, Staff Geologist, Abigail.Martin@respec.com

Geologists at the Rig: Abi Martin, P.Geo. (Project Geologist), and Michelle St. Louis, P.Geo. (Senior Project Geologist), Were Busy at the Rig This Past Summer Collecting Core During the Disposal Well Drilling Required for the Pilot Test. Tabetha Stirrett, P.Geo. (co-president, Canada), was happy to bust out the field gear to watch the 400-millionyear-old potash core come out of the ground during her site visit.

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November 2021 RESPEC M&E Newsletter

NEWSROOM

advising on acquisitions exceeding $5 billion in salt production

Solution-Mining Assessments From Technical and Economic Standpoints

As a trusted advisor with 50-plus years of experience in the salt-production industry, RESPEC completed several due-diligence evaluations in 2020 and 2021 for acquisitions totaling more than $5.2 billion, including the acquisition of Morton Salt. These acquisitions targeted 18 individual solution-mining and conventional-mining facilities spread across a large geographic area. Our team of experts led the assessment of each facility’s underground salt-production infrastructure from technical and economic standpoints. Through RESPEC’s continued growth and technical diversification, we also assisted by evaluating the structural, mechanical, and electrical aspects of surface infrastructure and processing facilities.

These due-diligence evaluations required a comprehensive and coordinated review of tens of thousands of documents within a tight bidding time frame.

RESPEC engineers and scientists quickly deployed to several solution- and conventional-mining sites across the United States and Canada to inspect underground and surface facilities while also interviewing key site personnel.

Working closely with the acquiring companies, RESPEC evaluated each facility’s operating and capital expenditures and provided counsel regarding the potential risks and benefits of the acquisitions. These due-diligence activities were completed amid COVID-19 challenges with RESPEC readily adapting to ensure that the evaluations were completed on schedule.

With RESPEC’s advisory services and recognized expertise in the solutionmining industry supporting the process, the three successful acquisitions represented major transactions and reorganization within the competitive salt-production business.

For detailed information, please contact RESPEC’s Sam Voegeli, Solution Mining Consultant Samuel.Voegeli@respec.com

Iconic morton salt brand invigorates significant buyer interest PROJECT details:

RESPEC was part of a multidisciplinary Due Diligence Client: K+S Sale of Morton team who reviewed the 15 Salt to Kissner sites that were part of the transaction between Morton Location: North America Salt and Kissner Milling Deal Valuation: $3.2 Billion Company Ltd™. These included both conventional underground salt mines as well as solution brine evaporation facilities. A team of over 20 RESPEC engineers and geologists completed the review and conducted virtual site visits with the mine staff.

With RESPEC’s support, the Kissner team was the successful bidder out of a group of 5 well-known industrial chemical companies.

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November 2021 RESPEC M&E Newsletter

GROWTH & PEOPLE

respec gains a grand junction team 30 Years of Solution-Mining Experience

Susan Patton - Dr. Patton is a principal consultant within the RESPEC Mining & Energy business unit. She is a diverse technical mining professional and project manager with expertise in mine ventilation, project assessment, project evaluation, and reserve reporting. She frequently leads scoping, pre-feasibility, and feasibility studies; due diligence efforts; productivity and material handling analyses; operating and capital cost estimates; and financial evaluations. She is a qualified/competent person for economic analysis and mineral reserve reporting (U.S. Securities and Exchange Commission [SEC] S-K 1300 and National Instrument [NI] 43-101) for bedded deposits using dry or solution-mining extraction techniques. She has extensive ventilation expertise in coal, metal, and nonmetal mines and mined caverns, including troubleshooting, modeling, design, and shaft sizing. Her expertise includes project management for wide-ranging potash and trona projects involving underground mechanical and solution mining.

Erik Hemstad - Mr. Hemstad has more than 10 years of experience in geological and geotechnical engineering. He has an established breadth of knowledge and experience across the geological, civil, and mining engineering and geology fields coupled with project, business, and personnel management capabilities as well as effective decision-making and judgment. Mr. Hemstad excels at undertaking diverse, complex projects and tasks in nonroutine environments in addition to creating and managing solutions focused on project execution and client satisfaction. His primary roles include project development, execution, and management for the RESPEC Mining & Energy business unit. Mr. Hemstad’s technical expertise includes geotechnical characterization; surface and underground geological evaluation; exploration program development and management; solution-mining engineering and design; resource and reserve calculation and reporting; and geophysical analyses, methods, and techniques.

Biao Qiu - Dr. Qiu has more than 8 years of experience in mining and geotechnical engineering with an emphasis on solution-mining design and underground geomechanical analysis. His solutionmining design projects have included wellfield design, cavern-growth and temperature simulation, brine-grade prediction, production scheduling, laboratory dissolution-rate tests, pilot-cavern design, production data monitoring, and ongoing drilling plan reviewing.

His geomechanical engineering projects have included ground-support design, barrier- and yield-pillar design, stability evaluation, groundsubsidence analysis, mine sequencing, ground-failure investigation, in situ stress determination, geological hazard identification, and laboratory rock-mechanics property testing. Dr. Qiu’s numerical analysis experience includes two-dimensional (2D) and three-dimensional (3D), linear and nonlinear mechanical simulation using the commercially available codes FLAC, FLAC3D, UDEC, Unwedge, and Examine2D.

Benjamin Haveman – Mr. Haveman is an established scientific professional with diverse project experience pertaining to geological, geotechnical, and civil engineering endeavors. His geology and geotechnically focused proficiencies include analyzing drillcore, generating core logs in digital formats, in situ stress measurement campaigns, geological investigations for mineral exploration and structural assessments, and technical report generation. His laboratory experience includes rock-mechanics testing, such as determining elastic properties; dissolution rate studies; and cavern-growth analysis testing in support of solution-mining operations. Mr. Haveman provides data collection and analysis involving time-domain reflectometry, which is used in subsidencemonitoring activities. He has direct experience with drilling operations over a diverse range of domestic and international mineral deposits.

Stefanie Von Flue – Ms. Von Flue is an engineering technician with nearly 20 years of experience in supporting the mining, civil, and geological engineering consulting industry. She has expertise in numerous computeraided design (CAD) and geographic information system (GIS) platforms, including ArcGIS, QGIS, AutoCAD, and Revit. Her experience includes graphic manipulation and presentation, mapping and reporting figures, dataset and database management, raster and imagery support functions, and technical report preparation and editing.

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November 2021 RESPEC M&E Newsletter

Grand Junction Office Core Competencies Solution Mining

Rock Mechanics

» Technical expertise in solution mining for worldwide mineral recovery, including development drilling (vertical and horizontal caverns), design modeling, optimization, and software development

» Surface and underground instrumentation design and installation

» Potash, trona, borates, and salt

» In situ stress analysis

» Dissolution testing and analysis

Underground Mine Design and Engineering

Exploration Geology » Development, design, management, and execution providing drilling oversight from small- to large-scale national and international projects » Geologic and geotechnical core logging and interpretation » Surface and underground geologic characterization and hazard assessment » Downhole geophysical evaluation

» Industrial minerals and evaporites » Mine-ventilation design, modeling, troubleshooting, and operations support, including Mine Safety and Health Administration representation » Mine planning » Numerical modeling » Subsidence

Industry Reporting for National and International Reporting Standards

» Equipment selection » Financial modeling

» Geologic modeling for resource and reserve estimates » Industrial minerals and evaporites » Due diligence

with the addition of our Grand Junction team, RESPEC has worked on nearly every potash and salt project in the world.

RESPEC Office Locations

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November 2021 RESPEC M&E Newsletter

SAFETY

Nitroglycerin Exposure in Blasting Operations Limiting Risk of Unique Hazards While On-Site

RESPEC employees working on mining and construction sites are exposed to unique hazards. One of these hazards is acute methemoglobinemia resulting from an overexposure to nitroglycerin.

Dynamite, while often found in construction blasting applications, has been identified at abandoned mine sites and any location where blasting operations have occurred. Employees must understand the risks associated with an overexposure to nitroglycerin when dynamite is used.

and Emergency Response (HAZWOPER) training should handle the explosives. Employees who are not actively handling dynamite should remain out of the blast area and at least 500 feet from any operation that is actively using nitroglycerin products.

Nitroglycerin overexposure can result from inhalation through airborne particles or absorption through skin contact when handling dynamite or when the dynamite’s protective wrapping has been damaged or deteriorated. When both air and skin contact occur, overexposure is possible even when particles in the air are very low.

» General Guidelines: Never give anything by mouth to an unconscious person. If you feel unwell, get medical attention, and show the label where possible.

Overexposure to nitroglycerin can cause acute methemoglobinemia, which is a blood disorder wherein too little oxygen is delivered to cells.

Oxygen is carried through the bloodstream by hemoglobin, a protein that is attached to red blood cells. Methemoglobinemia decreases the blood’s ability to carry oxygen and results in symptoms such as dizziness, drowsiness, headache, shortness of breath, blue skin and lips, a rapid heartrate, unconsciousness, and, possibly, death.

Nitroglycerin levels vary depending on the explosive product being used. In the explosives industry, a “powder headache” is a common early warning sign of overexposure. Once a powder headache and dyspnea (labored breathing) occur, the methemoglobinemia levels in the bloodstream are already at 20 to 30 percent. Seizures and/or a coma can result from methemoglobinemia levels of 50 percent, while death is expected at 70 percent or higher.

Preventative measures should always be taken when working where nitroglycerin exposure could occur. Non-porous chemical resistant nitrile gloves should be added to standard personal protective equipment (PPE) when handling any explosives containing nitroglycerin. Because of nitroglycerin buildup on the gloves, avoid rubbing your hands on your face or touching exposed skin. If the dynamite has deteriorated, only experienced personnel with explosives and Hazardous Waste Operations

Employees that have been exposed to nitroglycerin should take the following first aid measures:

» Inhalation: When symptoms occur, move to open air and keep at rest and in a position comfortable for breathing. Get medical attention.

Ventilate the suspected area. » Skin Contact: Wash contact areas with soap and water. Remove contaminated clothing. Wash contaminated clothing before reuse. » Eye Contact: Rinse cautiously with water for several minutes. Remove contact lenses, if present and easy to remove. Continue rinsing. Get medical attention if irritation persists. » Ingestion: Rinse mouth. DO NOT induce vomiting.

Get medical attention.

RESPEC employees are always encouraged to speak up when they feel unsafe or are exposed to risks in a setting where they have little experience. While most employees will never be exposed to nitroglycerin levels high enough to cause acute methemoglobinemia, knowing how to avoid potential exposure is important.

For detailed information, please contact RESPEC’s Brian Lewis, Explosives Specialist, Brian.Lewis@respec.com

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November 2021 RESPEC M&E Newsletter

RESPEC’s latest Presentation slides View All RESPEC Presentations on RESPEC.com

TRANSIENT HEAT TRANSFER ANALYSIS AND TEMPERATURE MODELING FOR SOLUTION MINING CAVERNS Biao Qiu, PhD, PE, PEng SMRI Fall 2021

Transient Heat Transfer Analysis and Temperature Modeling for Solution Mining Caverns Presented by Biao Qui, Staff Consultant SMRI, September 2021 Biao.Qui@respec.com

Cavern Thermodynamics Presented by Joel Nieland, Cavern Geomechanics Manager SMRI, September 2021 Joel.Nieland@respec.com

Underground Hydrogen Storage What are the Challenges?

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Sam Voegeli Energy Storage Consultant sam.voegeli@respec.com

October 18, 2021

RESPEC.com

Underground Hydrogen Storage: What Are The Challenges?

Presented by Sam Voegeli, Solution Mining Consultant SGA Conference, October 2021 Sam.Voegeli@respec.com

Geomechanics of Cavern Storage Presented by Sam Voegeli, Solution Mining Consultant SMRI, September 2021 Sam.Voegeli@respec.com

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Calendar of events As in-person conferences begin to return more regularly in 2022, we are so looking forward to meeting safely and reconnecting with our business contacts and acquaintances. To accomodate those that are more comfortable meeting virtually, we will continue with virtual participation as well. Whatever the platform, we are thankful for the opportunity to continue serving you and creating solutions that fit your needs.

Thank You

december—february 2021 conference schedule dec 1—3 dec 5—9 dec 7—8 dec 9—10 MLPA Annual Meeting

AEMA Annual Meeting

Osage Beach, MO

Sparks, NV

KCSA Underground Stone Seminar

Kentucky Blasting Conference Lexington, KY

Louisville, KY

dec 12—15

jan 30—feb 2 feb 27—mar 3

Illinois Association of Aggregate Producers Annual Meeting

ISEE Annual Conference

SME Annual Conference & Expo

Las Vegas, NV

Phoenix, AZ

Springfield, IL

Join us for a webinar on carbon capture utilization and storage!

Wed, Dec 15 at 12pm EST/11am CST

Join Dr. Matthew Minnick from RESPEC’s Energy group as he hosts a webinar about carbon capture utilization and storage (CCUS). Matt is leading subsurface engineering and modeling on multiple carbon capture storage projects in North America in various sedimentary basins. He is the chief reservoir engineer on multiple geothermal energy projects worldwide and is helping developers understand the use of supercritical CO2 for geothermal power production, storing CO2, and generating green power.

» Learn more and register here