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Sirius Minerals sees mine development activity rising every month

"Activity levels at the Woodsmith Mine continue to increase every month and now step up significantly as we commence diaphragm walling activities,” said Chris Fraser, Sirius managing director.

Potash product
The North Yorkshire mine remains on time and on budget

Sirius Minerals PLC (LON:SXX) told investors that mine development activity levels continue to increase every month .

The North Yorkshire mine remains on time and on budget, the company said in a quarterly update.

READ: Sirius Minerals' rumoured interest in nearby mine gets cool reception from Shore Capital

Sirius said that design work continued to identify simplification and capital reduction opportunities in parts of the project, although it stated that it is still too early to formally recognise these potential savings as reductions to the total project costs.

There had been an opportunity to accelerate aspects of the shaft sinking programme – namely earlier diaphragm walling – but Sirius said the opportunity could not be captured due to mobilisation and design delays.

READ: Sirius Minerals expecting to announce more off-take agreements by end of the year

Nonetheless, it highlighted there remains an opportunity to bring forward the start of tunnelling activity. Such a decision will come after further design and logistics works to be completed over the rest of this year.

"Activity levels at the Woodsmith Mine continue to increase every month and now step up significantly as we commence diaphragm walling activities,” said Chris Fraser, Sirius managing director.

“Our team, including both employees and contractors, continues to grow as we expand the Company's execution capability and we are pleased with the progress being made and the positive attitude across the expanding team."

Language has become "incrementally more positive"

In a note to clients, analysts at Liberum Capital said: “Language around marketing and sales contracts has become incrementally more positive and some colour was given on the current phase of stage 2 financing discussions.”

They added: “The stock seems to have found a level around the convertible exercise price at 25p and moving into the last quarter of the year there is increasing likelihood of positive catalysts coming in the form of further sales announcements which de-risk sage 2 financing and provide additional validation of the product.”

Liberum reiterated a ‘buy’ rating and 60p price target on the stock.

In late afternoon trading, Sirius shares were down 1%, or 0.26p at 25.25p.

 -- Adds analyst comment, share price --

Quick facts: Sirius Minerals PLC

Price: 3.424 GBX

LSE:SXX
Market: LSE
Market Cap: £240.34 m
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