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Sirius looks to construction of York project after key planning notice

Sirius Minerals says it's looking forward to beginning building its huge UK potash mine next year after it received a key decision notice from the North York Moors national park authority.

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Polyhalite is used to make fertiliser..

Sirius Minerals (LON:SXX) says it's looking forward to beginning building its huge UK potash mine next year after it received a key decision notice from the North York Moors national park authority.

The granting of the mine and mineral transport system formalises a major milestone and brings to an end a four year planning process, it said.

Chris Fraser, Sirius's managing director and chief executive, said: "We are delighted to be through this key approvals process and to now be moving into the delivery phase of this world class project.

"On behalf of everyone at Sirius, I want to thank the thousands of people who have supported the project to date and we look forward to beginning construction during 2016."

The project is the world's largest and highest grade deposit of polyhalite, a multi-nutrient form of potash used in fertiliser.

The firm's high-volume project could enjoy a mine life of more than 100 years even at a full production rate of 20mln tonnes per annum (Mtpa) of polyhalite.

The group is currently finalising its definitive, or bankable, feasibility study (DFS), which remains on track for completion this quarter.

It now has all planning approvals required to kick off construction and is continuing value engineering work with a number of contractors ahead of construction.

Sirius has always planned for the concept to be funded by a series of financings and previous feasibility work has indicated total capital costs in the order of US$3bn.

The plan is to access debt markets for the majority of the construction costs, as the company believes the project economics ‘lend themselves’ to high leverages and because it is in the long term interests of shareholders.

Sirius has said it intends to split the financing into two stages.

Shares eased 1.39% to stand at 17.75p.

Quick facts: Sirius Minerals PLC

Price: 3.54 GBX

LSE:SXX
Market: LSE
Market Cap: £248.51 m
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