Anglo American commits to saving £2.5bn potash mine project

Aaron Morby 1 month ago
Share

Mining giant Anglo American is now set to save Yorkshire’s £2.5bn potash mine construction project.

The Woodsmith mine project involves sinking two 1.5km shafts below a national park on the North York Moors to access a huge deposit of polyhalite, a mineral that can be used as fertiliser
The Woodsmith mine project involves sinking two 1.5km shafts below a national park on the North York Moors to access a huge deposit of polyhalite, a mineral that can be used as fertiliser

Project developer Sirius Minerals is recommending shareholders accept a 5.5p a share offer from Anglo to buy the polyhalite fertiliser project for £400m.

Sirius Minerals has warned shareholders, who stand to suffer a significant loss, that the firm will fall into administration if the offer is not accepted.

Anglo American has committed to salvaging the construction project spending around £230m a year for the next two years to keep construction going.

This will allow main tunnelling contractor Strabag, civils specialist P J Carey and mineshaft contractor DMC Mining Services to continue working on the vast scheme.

The full scheme will require £2.5bn to complete, which Anglo is committed to delivering, subject to a development review over the next two years.

So far around £850m has been spent on the scheme.

Sirius Minerals was forced to scale-back construction on the project last November after failing to secure further major funding for the vast construction project.

Failure to raise the $500m needed for the next major phase of construction saw shares in the firm crash 60% to 4p late last year.

Hundreds of workers were laid off at the North York moors potash mine site although Austrian tunnelling specialist Strabag, which has the contract for the three main 23-mile tunnel drives to transport excavated material to the coast, continued construction on one of its drives.

Mark Cutifani, Chief Executive of Anglo American, said: “Anglo American’s recommended offer provides greater certainty for Sirius’ shareholders, employees and wider stakeholders, while bringing the prospects for the development of this potential Tier 1 Project closer to reality.

“We intend to bring Anglo American’s financial, technical and product marketing resources and capabilities to the development of the project, which of course would be expected to unlock a significant and sustained associated employment and economic stimulus for the local area.”

Russell Scrimshaw, Chairman of Sirius, said: “We also recognise the returns that this offer would represent are not what either our shareholders or the Sirius Board had previously hoped for.

“We regret that we are not able to deliver on our long-term goal of Sirius being able to deliver the project into production, although we assure all stakeholders that the team has worked tirelessly and diligently over the last nine years to try and achieve that.”

He added: “We now face a stark choice. If the Acquisition is not approved by Shareholders and does not complete there is a high probability that the business could be placed into administration or liquidation within weeks thereafter.”

 

 

Latest news

Health chiefs issue details of £73m Multiplex hospital claim

Eleven technical problems highlighted at Glasgow’s Queen Elizabeth University campus
9 hours ago

GMI nets £95m haul of orders in first two months

Six projects secured in the North and Midlands, total close to 1m sq ft
10 hours ago

Construction firms OK with price-fixing and bid rigging

Competition and Markets Authority survey shows problems ingrained in industry
17 hours ago

Winners unveiled for £400m Essex framework

Council boosts numbers to minimise impact of possible contractor failures
14 hours ago

Unite reveals £20m cost of replacing HPL cladding

High pressure laminate cladding found on 16 buildings after ACM cladding refit completed
17 hours ago

Balfour Beatty wins £10m radium clear-up job

Radium from scrapped second world war aircraft being washed up at Dalgety Bay
13 hours ago

£1bn London Bankside Yards phase 2 approved

Major second phase of five buildings clears planning
17 hours ago

Graham to start £40m new M11 Harlow junction

Work to start on delayed 7a junction this spring
17 hours ago

Steel and cladding packages awarded at Paddington Square

Wins for William Hare and Focchi as Mace agrees £350m price to complete project
1 day ago

Willmott Dixon on call for £21m fire station

Planning to go in this spring for new training complex in West Sussex
1 day ago

Costain to offer clients low-carbon option in bids

Decarbonising option to be pitched to all clients from 2023
2 days ago

Derwent advances zero carbon building target by 20 years

New business model will involve turning brown buildings green
2 days ago

New watchdog to clamp down on shoddy building work

Independent Ombudsman given wide-ranging powers to protect homebuyers
2 days ago

Insurer warns hot work fire claims have spiked

Call for thermal imaging cameras to be used on site to combat rise in hot work fires
2 days ago

Construction nearly double size of official figures

Industry's real vital statistics put it above manufacturing
3 days ago

Spie fined after child killed by overhead power pole

Court hears how pole rolled down embankment and crushed 12-year-old
2 days ago

Eye-catching Newcastle office plan

Ribbon-like office scheme will be built near the Gateshead Millennium Bridge
3 days ago

Gilbert-Ash wins £26m Brunel Uni job

New teaching block to be built at Uxbridge campus
3 days ago

Boost your online presence – join the Enquirer Directory

Site for suppliers and buyers showcases products, services and latest stories
2 years ago

Contractor rethink on delayed smart motorway jobs

Fears grow Costain and Galliford Try's north west smart motorway projects will be rebid
3 days ago

Harry Fairclough Construction ceases trading after 120 years

150 staff made redundant at Warrington contractor
6 days ago

L&Q names new line-up of facade specialists

Bid races start for mechanical and electrical specialists
3 days ago

Sisk wins £21.5m deal to upgrade Leeds Corn Exchange area

Work to start in June on improving transport routes
3 days ago

Strucktor lands M&E package at £460m Raffles hotel

Specialist bags major win from Ardmore on Whitehall conversion job
5 days ago
STRUCKTOR UK

Construction work stops on another Elliot Group tower

Work suspended on £70m The Residence in Salford
7 days ago

Costain Welsh road job £100m over budget and two years late

Row simmers with Welsh Government about liabilities for cost overruns
7 days ago

London super sewer passes halfway point

Two further TBMs to be launched this year for east part of 25km drive
6 days ago

Entire facade of wind damaged tower to be strengthened

Major remedial programme planned after three cladding panels blown-off
6 days ago

BAM trading steady after second half uplift

Rise in profit at BAM Construction offsets fall at BAM Nuttall civils arm
6 days ago

Plan in for £30m East London ice rink

Twin pad ice skating centre will be biggest in southern England
6 days ago

Contractor services