Embarking on a promotional tour in October, South Boulder Mines managing director Lorry Hughes headed first to a fertiliser conference in Melbourne.

He spent the bulk of his sojourn, however, in cities where not only industry, but plenty of investors also, understand potash fertiliser, chemically known as potassium oxide (K2O).

Australia does not produce potash but 170 nations import it and Russia, Germany and Canada supply most of the 50 million tonne per year demand.

Hence Hughes ended up in Munich, but also spent time in Vancouver, Toronto and New York, following up on the company's first broker research to come out of North America. In late November he headed to London.

South Boulder Mines, as its name suggests, has hardly been known as a potash player since listing in 2003.

While still a grassroots explorer, the company enjoys quite a profile within the international potash industry.

The reason is its Colluli potash project in Eritrea. Since picking this up in a competitive tender in 2008, the company has fielded at least one cold call every two weeks.

The callers are invariably interested in partnering South Boulder in Colluli. Or they are keen on helping separate the substantial project into a dedicated potash company, ready for a potential listing on an international exchange, possibly Hong Kong or Toronto.

South Boulder is up front about its plans to spin off Colluli and the project's broader attractions.

"Our project is one that any major would desire to have," Hughes told RESOURCESTOCKS.

"The value of a serious potash company is not lost on companies such as Vale, Rio [Tinto] and BHP [Billiton].

"These companies are in, wanting to get in, or just out of and wanting to get back in to potash."

The potash approaches have come from all over the world.

"Potash has been previously not well known here [in Australia], but there's a whole potash industry that's becoming more understood by Australian investors and market watchers.

"Colluli is virtually in the backyard of the Middle East and investors feel comfortable investing in their own backyard.

"And the buyer potential is in places like Indonesia, India and China."

The project is indeed perfectly well-positioned, within economic distance of two ports. This places it perfectly for shipping routes east to Asia and north to the Middle East and Europe.

Colluli also is well placed geologically, in a basin where substantial shallow potash mineralisation has already been confirmed by historic and recent diamond drilling.

Despite its vision, South Boulder is under no illusions about the work ahead.

"We are concentrating on getting the project to a state where we can first evaluate it ourselves," Hughes admitted.

"Our first results have exceeded all expectations."

Initial results included: 7.72 metres at 16% K2O (25% potassium chloride) from 28.68m, including 3.44m at 28% K2O (44% KCl); and 14.79m at 10% K2O (16% KCl) from 48.55m, incorporating 3.2m at 14% K2O (22% KCl) and 4.2m at 16% K2O (24% KCl).

The depths and grades point directly to comparatively cheap project capital and operational expenditure.

"This confirms to everybody that this is a serious deposit," Hughes said.

"I think we'll go a long way to achieving a dedicated listed potash company within the next 12 months."

South Boulder is targeting a resource estimate by year's end.

The company also holds Australian potash and phosphate interests and is likewise considering packaging and listing these.

It has established an office in Eritrea and has recently applied for additional ground, this time gold-prospective.

"Twenty companies are in Eritrea exploring mainly for gold and base metals, and we're there and like to maximise our potential, so we look at these things all the time," Hughes explained.

Eritrea by no means represents the extent of South Boulder's current endeavour or expenditure, however.

Of most note is the company's Duketon project in Western Australia, which is developing into promising gold and nickel returns.

South Boulder listed on its WA Duketon project, located in a region still delivering good finds.

This is the very same region in which South Boulder's chairman Terry Grammer discovered the highly profitable Cosmos nickel deposit.

The Duketon nickel sulfide joint venture is fully funded by Australian Securities Exchange-listed Independence Group.

Independence is earning 70% by delivering a bankable feasibility study.

Work has centred on a large anomaly known as The Bulge.

Mineralisation has been defined over 750 kilometres of strike and 400m of dip.

"Within The Bulge area there could be a bunch of mines," Hughes said.

"We have five or six key prospects and expect to have a mining lease granted within the next six months.

"We have applied for it under robust conditions."

Two priority mineralised areas, The Bulge Rosie and The Bulge C2, are just two kilometres apart with mineralisation open in most directions.

Rosie drilling this year returned a 5.2m intercept of massive sulfide estimated at 9.13% nickel, 1.08% copper and 7 grams per tonne platinum group elements.

Broader intersections of lower grade disseminated and stringer sulfide 25m, 37m and 50m thick from C2 also have encouraged.

Completion of a scoping study is anticipated in the March quarter, with an underground operation at Rosie and an open pit operation at C2 under consideration.

South Boulder holds 100% of the gold and base metal rights over the Duketon tenure and remains keen on fully assessing their potential.

"We'll be spending $1 million on our gold exploration in the next 12 months," Hughes said.

Initial drilling results are expected for the Duketon gold project by the end of April next year following an aerial magnetic surveying now underway.

South Boulder will initially concentrate on three prospects. One, the Terminator prospect, returned grades of up to 28.6gpt gold from reverse circulation drilling earlier this year.

"We want to be a nickel producer with Independence Group at the Duketon Nickel Project and we want to make a commercial gold discovery," Hughes explained.

"And while we never envisaged being a potash producer when the company listed, we are now on the verge of a major discovery and will potentially create a dedicated potash company.

"It's taken some time, but we are actually in a fantastic position."

While Hughes has set out to ensure a South Boulder profile in major international markets, the company is not desperate for cash.

It has $6 million in the bank and equities investments, plus options due for conversion,

When it comes to the project development stage, the company already is confident of garnering support.

Its only true Australia-listed peer may be Elemental Minerals, holding an early-stage potash resource project in the Republic of Congo.

However, South Boulder already is assured of recognition.

While relatively unparalleled in Australian markets, it has been listed in a global potash report as an early greenfields explorer along with the likes of Canada-listed explorers Allana Potash Corp, Western Potash Corp and Talon Metals Corp, each boasting considerable market caps.

"This is important," said Hughes.

"When people ask me what I do, I tell them we are all about creating jobs and wealth.

"And this is what we are now doing."

* This report, first published in the November/December 2010 edition of RESOURCESTOCKS magazine, was commissioned by South Boulder Mines