Sirius Minerals signs additional sales agreements

10 September 2013 15:44  [Source: ICIS news]

LONDON (ICIS)--Sirius Minerals Plc has signed agreements to sell an additional 750,000 tonnes of polyhalite into China, Africa and Latin America, from its planned potash mine in north Yorkshire in the UK, the company said on Tuesday.

The deal brings the company’s new sales commitments to a total of 2.78m tonnes from 2.03m tonnes earlier and the producer is in talks to conclude further agreements, Sirius said.

The sales commitments cover over half of the company’s initial production target of 5m tonnes/year.

“Sirius has only been formally marketing polyhalite for nine months, so to have secured agreements covering almost 60% of the initial production target of 5m tonnes/annum and to be in discussions that could see us potentially over sold is extremely encouraging,” said Chris Fraser, Managing Director & CEO of Sirius.

The North York Moors National Park, where the company’s project is located, holds the world’s largest estimated resource of polyhalite, a mineral compound from which specialty fertilizer sulphate of potash (SOP) can be produced.

The new agreements include a Memorandum of Understanding entered into with China-based CNAMPGC Holdings Limited Corporation (Sinoagri) for the sale of 500,000 tonnes/year of polyhalite for 10 years, Sirius said.

The terms will be at market price to be agreed at the final contract stage, the company said.

In addition, Sirius has signed agreements for an additional 250,000 tonnes/year of framework agreements with customers in Africa and Latin America.

A summary of sales/offtake agreements signed by the company so far is as follows:

 

Agreement

Region

Size/year (tonnes)

10-year offtake agreement with Yunnan TCT Yong-Zhe

China

1,000,000

Memorandum of Understanding

China

500,000

Framework sales agreements/ Letters of Intent

Africa, Central/Latin America, Europe, UK, southeast Asia

1,280,000

Total

 

2,780,000

 

Production at the York project is scheduled to begin in 2017, although the project is seeing some delay as environmental agencies have questioned the impact of the York Potash project on surrounding areas.


By: Deepika Thapliyal
+44 208 652 3214



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