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Sirius Minerals says finance deal will support York Potash project
A POTASH company, which wants to operate a £1.5bn mine in the North York Moors, has secured £25m funding from a New-York based investor that it says will help push forward the development.
Sirius Minerals, who want to create up to 1,000 jobs mining polyhalite, a form of the fertiliser potash, near Whitby, says the cash will increase the chances of seeing plans for its York Potash project approved and lift its value in the global potash fertiliser market.
The firm says the deal strengthens its position in the potash industry, which was hit by worries of a worldwide price crash when Russian company Uralkali pulled out of an agreement with a Belarusian partner that controlled nearly half of the international market.
Chris Fraser, Sirius' managing director and chief executive, said: “We are delighted to secure this financing, which demonstrates confidence in the development of the York Potash project, especially at a time of increased volatility in the sector.
“These funds will enable the company to undertake the necessary work needed to secure the required approvals, in addition to other developments such as global crop trials that will continue to demonstrate the unique value of polyhalite.”
The announcement comes after Sirius was last week backed its York Potash project following claims from its own broker that its shares were not worth buying.
The company said any market financial changes could affect larger companies dealing in muriate of potash, a source of potassium fertiliser, but believed its polyhalite gave it a unique place in the market.
Mr Fraser said: “There is little doubt that potential reductions in muriate prices present a problem for existing high-cost producers, but the York Potash project has a robust business model to underpin its development as a long-term independent supplier.
“This just re-emphasises the need for new, low-cost, long-life projects operating outside the existing restricted market.”
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