iNVEZZ.com Thursday, September 19: Shares in Sirius Minerals Plc (LON:SXX) yesterday rose 6.61 percent to 10p after the British potash miner announced ‘probable’ reserves of 250 million tonnes of polyhalite at its York Potash project.
The AIM-traded company, behind controversial plans to build a huge potash mine in a Yorkshire national park, said in a trading update that the ore reserves had a mean grade of 87.8 percent. Indicated mineral resources, with an average grade of 87.3 percent, were estimated at 820 million tonnes.
Sirius CEO Chris Fraser said in the update: “The York Potash Project will deliver significant value to our shareholders and can make an exceptional contribution to the UK and local economies.” He continued: “Defining such a significant high quality Ore Reserve is a vitally important step in the financing and development of the project.”
**Project Delayed Until 2014**
The reserves report came just days after Sirius announced that it would not submit a planning application for the $1.9 billion potash project in the North York Moors until July next year, which means a new timeline. Sirius Minerals wants to build the mine near Whitby and connect it by pipeline to a new port on Teesside. It had been due to present its proposal to the North York Moors National Park Authority in July but has now
asked for a postponement to give it more time to address “environmental queries”.
On Monday, the London-based miner said that it would submit a combined environmental study covering the mine, pipeline, plant and port instead of first seeking approval for the mine and pipeline. Referring to that change in strategy for planning approval, CEO Fraser yesterday noted that while the extra time needed for the approvals is “frustrating for our many supporters, a potential mine life of over 100 years hopefully puts that into some perspective”.
Meanwhile, the national park authority said that even if Sirius presented its environmental statement next July a decision on whether to grant permission might not be made until December 2014.
!m[Potash Miner Declares Accessible 250MT](/uploads/story/5567/thumbs/pic1_inline.PNG)
Broker Investec yesterday rated the ore reserve news as positive but warned that “until all permitting has been secured and agreed, unlocking value from the reserve will obviously not be possible”. On Monday this week, the Financial Times quoted analysts at Liberum, brokers to Sirius, as opining that while “the impact of the announcement on the project timeline is a delay, the impact on our valuation is marginal given the back-ended nature of project cash flows”.
**As of 8:37 BST today buy Sirius Minerals shares at 10.25p**
**As of 8:37 BST today sell Sirius Minerals shares at 9.91p**