Sirius Minerals may be long-gone but through Anglo American Plc's (LSE:AAL) automation and modern mining technologies the future of the Woodsmith mine, in North Yorkshire, still appears to be alive and kicking.
The Yorkshire fertiliser project - which is designed to extract huge volumes of polyhalite, a somewhat novel type of potash fertiliser, from beneath a national park - has had no shortage of challenges, not least the spiralling costs and financing problems that ultimately saw Sirius sell to Anglo at a bargain basement price back in 2020.
Nevertheless, with global fertiliser prices soaring amidst the current geopolitical crises in eastern Europe there’s a stronger economic underpinning to the project.
Anglo, which bought the project for £460mln two years ago, as recently as December revised its plans for the mine, upgrading Woodsmith’s scope following a detailed technical review.
In late 2021, the mining group said its 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. At that time, Anglo also switched out former Sirius boss Chris Fraser from Anglo’s Crop Nutrients unit (which holds the British asset) replacing him with Tom McCulley.
The appointment of McCulley was made notable relevant via a new corporate video published by Anglo in the past few days.
McCulley led the development of Anglo’s giant Quellaveco modern copper mining project in Peru.
Anglo chief executive Mark Cutifani, in the video, described Quellaveco as “the model for what a future mine should look like” as the mining group espoused the virtues of its automation
“Quellaveco represents the future. A representation of what we hope a mine can be, technically, operationally, and in its connection with the local community,” Cutifani said.
The Anglo boss added: “For us, it’s the starting point for a much deeper and broader technology-driven future for the mining industry, which is where we need to go.”
McCulley, the new man in charge of the Yorkshire mine development, highlighted the advancements used in Peru. “We’re trying to use everything that ‘FutureSmart Mining’ [which is Anglo’s concept to combine technology, digitisation, and sustainability] has to offer today. In 100% automated trucks, automated drills.”
“Quellaveco is the model for what a future mine should look like” – Mark Cutifani, Chief Executive.
Mark, Tom McCulley and Adolfo Heeren discuss Quellaveco’s journey and what it means for the future of mining. Learn more about Quellaveco here: https://t.co/bTKoPeh0Tj pic.twitter.com/RPef6P7luk
— Anglo American (@AngloAmerican) April 8, 2022
Signing off the short promotional corporate video, Cutifani noted: “when you look at Quellaveco, Woodsmith to come, Sakatti [a multi-metal mine in Finland] and the other options we have, we really do have a pipeline of opportunities that are second to none in the industry.”
In December, Anglo told investors that it expected to improve on the Sirius mine plans, would execute elements of construction differently, and would develop the mine on a more conservative schedule.
A new engineering design, capital budget and schedule are all expected to be in place by the end of 2022, Cutifani detailed in December, and the full project proposal would subsequently be submitted to the Anglo board for an investment decision.