Boulby Mine is digging deep to rescue its mining operations with £80 million worth of investment.
Following last week’s shock announcement that over 700 jobs are to be lost due to potash reserves running out within the next three years, the mine’s parent company, ICL UK, revealed its new restructuring plan.
It is going to switch from mining for potash to sourcing polysulphate – an environmentally friendly fertiliser consisting of sulphur, potassium, magnesium and calcium.
A spokeperson said: “The Boulby Mine is the world’s only producerof the new product with an estimated potential resource of approximately one billion tonnes and ICL will be making a significant investment to achieve the move to large scale production, with a target of a million tonnes by 2020.”
ICL UK says it intends to achieve this by investing £20 million this year into the infrastructure of the site just north of Staithes.
There is potential for a further £20 million worth of investment to enable the mine to expand its production from 200,000 tonnes per year to a million tonnes by 2020.
The long term projection is that three million tonnes of the product can be mined per year.
A feasibility study is also being carried out with a view to a granulation plant being constructed at a cost of £40 million.
Peter Smith, Executive Vice President-Potash of ICL, said the restructuring, although painful, is vital to secure the future of ICL UK as a viable business.
He said: “This is the road we believe can secure the future of Boulby.
“Once the move to Polyhalite production occurs, ICL UK will remain a significant employer, but it is unlikely to be at the same level as in the past.
“Boulby has played a major part in the economy of the area for a long time and has supplied its products to customers across the world.
“The process we are now embarking upon, although difficult and challenging, is aimed at ensuring that it will continue to be a major force in the local community – and a supplier of world-class fertiliser products – for many years to come.”
As part of the restructuring programme ICL UK has begun consultation on around 220 job losses amongst its employees.
In addition there will be a reduction of 140 in contractor numbers.
It is believed that a further 300-plus jobs will be lost by 2018.
Mr Smith added: “We understand that proposals for staffing reductions will cause concerns for employees and their families. No decisions will be finalised until the consultation with the trade unions has been completed.”