£1 billion plan announced to finance potash mine

Sirius lays out funding route for Whitby site.

Thursday, 3rd November 2016, 1:45 pm
Updated Wednesday, 16th November 2016, 4:02 pm
The site of the potash mine

The company behind the construction of a £2 billion potash mine near Whitby, has announced plans to finance construction.

Sirius Minerals has launched a £1billion funding plan, which represents stage one of their two-stage financing plan.

Having secured the backing Gina Rinehart’s Hancock British holdings, who committed a £250 million investment into the project last week, the company is now pressing forward with plans which aims to raise approximately £1 billion.

Along with Hancock’s backing, a further £400 million will be raised by issuing new shares on the stock market and £350 million by issuing convertible bonds.

Chris Fraser, managing director and chief executive officer, said: “I am delighted to announce this proposed fully underwritten financing package which provides the comprehensive Stage 1 financing required to start construction of our North Yorkshire polyhalite project.

“This project will create jobs in North Yorkshire and Teesside, and represents a significant business investment in the UK.

“It’s been a long journey to this point, and we still have some way to go, but I want to thank everyone who has supported the company in its efforts to reach this major milestone.

“Once we have received shareholder approval, we want to get on with the job of delivering this compelling value proposition, not only for our shareholders but also for the North Yorkshire community.”

Work is yet to start on the site, but Sirius Minerals intends to begin construction once funding has been secured, ahead of targeted first production by the end of 2021.

Robert Goodwill, MP for Whitby and Scarborough, said: “I look forward to seeing the many benefits of this project materialise and remain strongly supportive of the positive impact the project can have on the UK economy.”

The project will potentially create over 1,000 jobs in Whitby and on Teesside. The mine will intitially aim to produce 10 million tonnes of fertiliser per annum, later potentially rising to 20 million tonnes each year.