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Sirius Minerals reaches ‘significant milestone’ in Yorkshire mine development as key procurement processes complete

Financing efforts are underway, to secure around US$3bn of Stage 2 project funds

Sirius Minerals Woodsmith mine
The MTS will comprise 37kms of underground conveyors

Sirius Minerals PLC (LON:SXX) told investors that procurement is complete for the major construction packages in its Yorkshire mine development project.

"Procurement of the mineral transport system fit-out marks the completion of our major construction procurement programme to support our stage 2 senior debt financing process and is a significant milestone for the company,” said Chris Fraser, Sirius chief executive.

“Our efforts are now focussed on the successful execution of our financing plan to fully finance the construction of our world-class, long-life polyhalite project."

READ: Sirius Minerals shares tipped to double, if financing is secured on time

It confirmed the fit-out for the mineral transport system (MTS) – which will be capable of moving fertiliser product on 37 kilometres of conveyors, buried 360 metres beneath the ground - has been agreed and finalised with contractor STRABAG AG.

The MTS is expected to transport some 20mln tonnes of material per year.

The company, in a statement, said that the scope of the MTS fit-out included the MTS conveyor, the maintenance railway, electrical and communications infrastructure, and all other services in the tunnel essential to operations.

Sirius said the price of the MTS fit-out was “in line with the Company's capital re-estimate” stated in September, and, noted that more than half the cost would be priced at fixed rates or on a lump sum basis.

The overall remaining overall capital funding requirement for the mine construction project was most recently estimated at US$3.4bn to US$3.6bn, and, Sirius believes the appropriate level of senior debt financing would be US$3bn. It will not seek to increase to increase that, the company added.

The proposed work schedule for the MTS is in line with the overall project delivery schedule.

Quick facts: Sirius Minerals PLC

Price: 3.55 GBX

Market: LSE
Market Cap: £249.22 m

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