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EUROPE

Woodsman’s polyhalite ore will be Mark Cutifani
transported by pipeline to Wilton
in Teesside for processing into the
Poly4 multi-nutrient product
$US300 a year during the first two years
following acquisition. Sirius estimated total
development capex of $US3.3 billion for
Woodsman.
“We expect development work on the
project to be broadly in line with Sirius’ own
revised development plan, although natu-
rally we intend to update the project time-
line, optimise the mine design and ensure
there is the appropriate integration with
our operating standards and practices,” he
said.
Cutifani said most of the Sirius manage-
ment had agreed to stay with the project
for at least the first 12 months.
Anglo’s move comes at an intriguing
time for the fertiliser space with a number
of majors positioning themselves for major
developers and a swag of Australian jun- “Sirius’ planned production is around 30
iors also hoping to break into the market. times larger than the total polyhalite market
“Anglo American’s potential offer for size in 2018,” it said in a note. “The com-
Sirius Minerals… highlights the potential pany plans to rapidly increase production
for consolidation in the to over 10mt only a few years after start-
potash space and the ing operations, which adds to concerns
demand for world-class of significant disruption to wider fertiliser
projects,” Numis Secu- markets — even with its numerous offtake
rities said of the deal. agreements.”
Another London The project would be Britain’s largest
firm, Berenberg, said mine development in more than a genera-
Anglo’s technical and tion. UK Prime Minister Boris Johnston had
financial muscle made previously resisted requests from Sirius to
the acquisition and de- support funding efforts for a project which
velopment achievable. could create up to 4,000 jobs to the region.
“Given Anglo’s min- Henri Murison, Northern Powerhouse
ing experience it makes partnership director said Anglo American’s
sense from a technical acquisition would provide certainty for the
perspective and Sirius project and its current 1,200 employees.
had been looking for a He also said the project would become a
strategic partner,” Ber- highly visible part of economic renewal in
enberg said in a note to the region.
clients. “Further, given “It will deliver substantial economic ben-
Anglo’s strong balance efits to whole of the UK, including notably
sheet, it can comforta- to the balance of payments, and if the
Sirius’ Woodsman project is expected to cost more than
$US3 billion to build bly fund capex. We can Government is genuinely serious about
see how the project fits levelling up and narrowing the north-south
in the Anglo portfolio of divide, it will need to back privately led in-
tends to stick with that capacity, although late cycle, green commodities, but given frastructure projects like this in the future,”
director strategy and business develop- that this is a new commodity for Anglo, and Murison said.
ment Duncan Wanblad said the project given the market’s strong focus on share- Cutifani said he had been impressed by
was permitted to 13 mtpa and could fea- holder returns, it is likely to take some Sirius’ engagement with the local commu-
sibly produce up to 20 mtpa if required. investor education as to exact market dy- nity. Anglo American has already invested
Fielding questions from analysts on namics and outlook, particularly with BHP £1 million into the Sirius Foundation.
the project’s potential, Wanblad said the [Ltd]’s Jansen project also progressing “As a very clear intent about our support
“nature and style” of the deposit made it along the development path, and how this for the community, on completion of the
unique among polyhalite deposits. fits in Anglo’s capital allocation strategy.” acquisition we would put £1 million into the
“Not just in the total volume but how it Peel Hunt said the inevitable long lead Sirius Foundation and put another £1 mil-
presents itself,” Wanblad said. “There are time for construction meant the project lion on the anniversary of the acquisition
seam widths beyond 20m in some areas was always more suitable to a “much larg- on each of the next two years,” he said.
so it offers a flexibility which known poly- er company”.
halite deposits don’t.” CRU, however, deemed the acquisition – Dominic Piper and Reuters
Cutifani said the company would spend a risk.

aUSTRaLIa’S PaYDIRT FeBRUaRY 2020 Page 73