Anglo American PLC (LSE:AAL) upgraded the scope of the Woodsmith project, the once headline-grabbing North Yorkshire Moors polyhalite fertiliser project developed by Sirius Minerals.
The FTSE100 mining giant took control of Woodsmith in April 2020 when it acquired Sirius Minerals for £460mln. It has now largely completed a detailed technical review of the project that confirmed the findings of the company’s due diligence.
The review identified elements of the project’s design that would benefit from modification to bring it up to Anglo American's safety and operating integrity standards and to optimise the value of the asset for the long term, Anglo said in a stock market announcement.
Anglo American is also making a change to the leadership of the project following its integration into Anglo American and ahead of the full project execution phase. Tom McCulley, who has led the development of the Quellaveco copper project in Peru, will take over from Chris Fraser as chief executive officer (CEO) of Crop Nutrients. After 12 years of driving the project from inception to its position today, Chris Fraser, the former CEO of Sirius Minerals, will step aside and take on a role focused on strategic projects.
"We are very happy with the high quality and exciting potential of Woodsmith, with the scale and quality of the polyhalite orebody pointing to a Q1 [first-quarter] operating cost position and strong margins. This is a very long-life asset and we are going to take the necessary time to get every aspect of the design right to match our long term vision and value aspirations,” Mark Cutifani, the CEO of Anglo American said.
"We have said from the outset that we expect to make improvements and that we will execute certain elements of the construction differently and with a more conservative schedule. We expect to have completed our design engineering, capital budget and schedule at the end of 2022, with a fully optimised value case that recognises the upside potential we see in Woodsmith, and we will then submit the full project to the board,” he added.