Solaris exits Canada for Switzerland with new CEO, board and spin-out plans
The company changed its board of directors and plans to spin out non-core assets La Verde, Capricho, and Paco Orco into a new company.
Shares in Sirius Minerals (LON:SXX), the British company building a huge polyhalite mine beneath a national park, were off to the races on Wednesday after it announced it had secured a major seven-year African supply deal.
Sirius, which plans to sink two 1,500m deep shafts in the Yorkshire moors this year, said Intercontinental Trade DMCC Dubai had agreed to buy up to 350,000 tonnes a year of POLY4, the fertilizer product to come out of its Woodsmith mine.
The supply deal covers up to 350,000 tonnes of fertilizer a year for the seven years following the start of production.
The deal, said Sirius, also gives it exclusive marketing rights into Nigeria.
“Africa is a huge potential market for POLY4 and we are very pleased to establish our initial footprint in Nigeria, which is the largest market in West Africa,” managing director and chief executive Chris Fraser said in the statement.
The stock climbed more than 4% in London after the announcement, trading at 33p at 8:14AM local time, but dropped in the afternoon to close at 32.06p.
The York mine, poised to be one of the world’s largest in terms of the amount of resources extracted, is set to generate an initial 10 million tonnes per year of polyhalite – a form of potash that is used in plant fertilizers –, before it enters a second phase that will double that production to 20 million tonnes a year.
The operation will create about 1,800 jobs during construction and 1,000 permanent positions once it opens, in May 2021.
In a note to clients, Liberum called the news “a small incremental positive for Sirius” because it means the group now has binding agreements in place for 4.7 million tonnes of fertilizer a year, against a target of six to seven million tonnes, announced earlier this year. The agreement should help satisfy lenders as part of stage-two project financing.
Comments
snorx
Big questions from yr previous postings. Why is the UK taxpayer being stiffed with open-ended liabilities on guaranteeing loans for this which is clearly not an infrastructure project, but a dubious commodity-for-export deal? I absolutely agree with posters Eridge action and Karin Hall 3 months ago. Plus is this not the Preetpal
Walia [see the RNS mailshot] who is so permanently off-shored that his businesses in Bahamas need a list in ICIJ. Here’s what Karin Hall said:
Let’s see if I understand the game plan… Siriusly:
01. Potash remains in global oversupply condition.
02. Sirius Minerals reports $33.4 million dollar loss.
03. Sirius seeks $2 billion funding to complete underground Potash mine in
North Yorkshire UK.
04. Bankers aren’t interested and decline to loan.
05. Sirius seeks government guarantees for loans.
06. Sirius dangles the Jobs carrot in front of local politicians, promising
1000 permanent jobs.
07. Government bureaucrats massage loan guarantees through channels.
08. Mine construction heads toward 2021 completion date, but more funds are
needed and taxpayers must guarantee additional loans in order to ‘protect’
their initial ‘investment’.
09. Technological disintermediation marches forward.
10. Fully robotized mine opens in 2023 to much fanfare.
11. Autonomous equipment requires little maintenance, greatly reducing
operating ratio… and employment.
12. Management receives huge bonuses.
13. Shareholders receive large dividend.
14. 1000 permanent job promise turns out to be a desert oasis mirage.
15. Potash prices remain depressed.
16. Rosy financial projections are a total bust.
17. Huge operating losses are reported.
18. Government bureaucrats run for the hills with fat early retirement packages
in hand.
19. Loans go into default.
20. Taxpayers get stiffed and must toil for decades to pay back $2 billion +
interest to bankers.
21. Bankers are happy.
Business as usual