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Potash firm cuts cost of mine by £0.7bn
THE firm behind a mine which could create up to 5,000 jobs in the region has reduced development costs by about £0.7bn and could have the facility up and running within four years, if plans go ahead, it emerged today (December 3).
Further engineering work has revealed York Potash, which wants to start mining what is thought to be the world's largest deposit of the mineral polyhalite, used to make fertilizer component potash, can reduce the cost of creating the mine from £1.7bn to £1bn and complete it three months faster.
The statement was released to the City this morning by Sirius Minerals, the international mining firm which owns York Potash.
The project at Sneaton, near Whitby, could create up to 1,000 direct and 4,000 indirect jobs, but the high costs involved in extracting the mineral has prompted Sirius to launch a search for potential investors. It is also planning to crush and sell granular polyhalite rather than incur the high costs of processing the mineral. This morning, Sirius unveiled a project study update which outlines the reduced pre-production capital costs, which the firm says reduces project risk for investors and makes new jobs more likely.
The changes to the proposals will still necessitate an underground pipeline to a distribution plant in Teesside, and will not affect the final number of jobs.
Following detailed work, the company’s engineering team believes the mine could be constructed at least three months earlier than previously thought, further minimising the impact of the project’s construction.
Sirius also announced the results of a concept study which confirms the viability of producing NPK fertilisers using polyhalite, the potash ore targeted by the project, which is a source of potassium, sulphur, magnesium and calcium.
The company believes that this would be an innovative way of producing NPK fertilisers with all six macro nutrients that plants need for growth. At the moment, most of the world’s potash is typically mixed with nitrogen and phosphorous to create NPK fertilizers which allow farmers to provide balanced nutrients to their crops.
Chris Fraser, managing director and chief executive of Sirius Minerals said: “This study shows that we can significantly reduce the capital costs of the mine and construct the project quicker than we previously anticipated – speeding up the job creation and all the associated benefits of the project for the region.
“This is an important milestone for the York Potash Project because it outlines how, by maximising the unique benefits of polyhalite, we can become a world leader in the fertilizer industry, helping to provide a solution to the growing issue of global food security.”