Marifil Mines has entered into an option agreement to acquire the K-5 and K-6 potash properties located in Neuquen Province, Argentina.
The properties consist of 19 mining claims covering 52,172 hectares.
Marifil Mines will pay the seller $4.15m over four years, including $25,000 on signing a Letter of Intent.
The Canada-based company has already paid the seller $125,000 for signing the definitive purchase option agreement.
The firm has the option to purchase 1.5% of the two percent net smelter royalty retained by the seller for $1.5m and may also purchase the remaining 0.5% royalty for $1.5m.
Marifil Mineso president John Hite said that the company intends to spin these properties into a Capital Pool Company or a shell company that is currently trading.
"We would then plan to raise $3 million to $10 million to be used to drill one or more of the properties, produce a NI 43-101 resource, and then raise perhaps $15 million to $20 million to complete a feasibility study," said Hite.
"Further, one of our exploration programs is aimed to develop new phosphate resources. Argentina soils are deficient in phosphate and Argentina currently imports 100% of this important soil nutrient."
The company said the K-5 prospect could be an extension of the El Porton deposit, where significant sylvite (KCI) intervals with potash mineralisation were identified in seven separate horizons.
The K-6 target is located between the K-2 and K-5 projects and has a single oil well hole which has intercepted 2.8m grading 25% to 30% KCl at a depth of 627m.