Highfield Resources Ltd (ASX:HFR) is trading higher after reaching a pivotal point at its flagship Muga Potash Mine in Spain with initial construction activities underway.
Construction started after the Townhall of Undués de Lerda in Aragón issued a licence for the construction of the mine gate and the declines.
Shares are higher in response to the news, trading at A$0.90, an increase of 8.43% on the previous close and the company's market cap is approximately A$324.34 million.
The company has signed a construction contract with Acciona Construcción S.A. for these initial works which cover:
- fencing of the plot;
- installation of the above-ground construction staff facilities;
- clearing and stockpiling of topsoil;
- excavation of the mine entrance;
- formation of embankments; and
- stabilisation of the slopes with bolts and gunite (dry gun shotcrete).
“Pivotal point”
Highfield CEO Ignacio Salazar said: “We start construction at Muga with a great sense of responsibility towards our shareholders, our staff and collaborators, the banks, the community, the authorities and all stakeholders who have helped us to get to this pivotal point.
“We are receiving a significant endorsement from leading international banks in the financing process in this time of extreme geopolitical instability around potash supply, especially in Europe.
“We are working closely with the authorities and especially Navarra and Sangüesa to finalise the licensing there and will be reporting back to the market as we progress through construction.”
About Muga Project
Highfield’s flagship Muga Project in Spain is forecast to be one of the highest margin potash mines in the world.
The Muga project contains a measured and indicated mineral resource of 237.3 million tonnes at 12% potassium oxide.
The company is targeting the relatively shallow sylvinite beds in the Muga Project area that cover about 46 square kilometres in the provinces of Navarra and Aragón.