Sirius Minerals Plc Project quarterly update for Q1 2017 (6760A)

TIDMSXX

RNS Number : 6760A

Sirius Minerals Plc

28 March 2017

28 March 2017

Sirius Minerals Plc

Project quarterly update for Q1 2017

-- The Project remains on time and on budget

-- Enabling works nearing completion

-- Formal construction in the form of site preparation is scheduled to commence in the second quarter of 2017

-- Move to the Main Market expected be completed during April

Sirius Minerals Plc ("Sirius" or the "Company") provides its quarterly update on the development of its North Yorkshire polyhalite project (the "Project") for the first quarter of 2017.

Chris Fraser, Managing Director and CEO of Sirius, comments:

"We are making good progress with the development of the Woodsmith Mine and associated infrastructure, having successfully secured around GBP1 billion in November 2016 in our Stage 1 Financing, and we are pleased to be progressing in line with schedule and budget."

Safety

No recordable incidents were incurred during the period and the Project continues with its delivery with a total recordable incident frequency rate of zero.

Cost and schedule

The Project remains on schedule.

The budget for 2017 is broadly consistent with the projection outlined as part of the Stage 1 Financing plan. The Company is actively evaluating opportunities to accelerate components of the shaft and tunnel spend to further de-risk the implementation of the construction project and also to potentially create opportunities for shortening the Project schedule. Further updates will be provided as appropriate.

Land and access

Options have been exercised for the purchase of all land required at the Woodsmith Mine and for some of the parcels associated with the intermediate shaft locations. An option to acquire a portion of the land required for the materials handling facility ("MHF") has also been exercised. The remaining MHF land requirements remain under option and will be exercised on an as required basis. The process for acquiring the Company's strategic harbour site has commenced and will be completed over the next 12 months.

The process of converting the mineral transport system option agreements into leases has commenced and will continue through the first half of 2017. The majority of mineral rights are now secured under long term agreement having been converted from options in 2016.

Commercial

Contracts for the highways works, geotechnical drilling at the mine site and shaft engineering have been signed and are within budget. Negotiations are ongoing with AMC for the broader shaft sinking contract.

Permitting

The Company is making good progress in clearing the conditions outlined in the Project's planning agreements. It is anticipated that the Company will be able to commence site preparation activities in the second quarter of 2017 as scheduled.

Site preparation

Highways works have commenced around the Woodsmith Mine and in other locations as required. The first set of these works is on schedule to be completed in the coming weeks. Modifications required for access to Lockwood Beck will commence in the second quarter of 2017.

Site preparation earthworks at the Woodsmith Mine site are scheduled to commence in the second quarter of 2017.

Shaft sinking

AMC has continued with detail design of the shafts including associated surface facilities such as the production and service shaft winder buildings. Design and preparation work is already underway with AMC and Bauer, AMC's preferred diaphragm walling ("D-Walling") sub-contractor. The D-Walling activity is the process used to sink the first 120m of the production, services and TBM shafts. D-Walling preparation activities include the mobilisation of the rigs and planning for the support infrastructure such as the concrete batch plant, welfare, workshops and offices.

The design of the winders has progressed and manufacturing slots have been secured to enable two of the winders to be available in time for the commencement of the main shaft sinking. Electrical design for the winders has proceeded in parallel.

Sales and marketing

The sales and marketing team has expanded with Heads of Latin America, South East Asia and Europe now established in their respective markets. These executives join the Company from Koch Fertilizers, Belaruskali and GrowHow respectively. Resourcing for market analysis and agronomy is also growing to support the marketing efforts.

Commercial discussions are ongoing in the key growth markets of Europe, Brazil and Africa. Each of these opportunities represents a material volume opportunity in a new market for Sirius. In addition to this, the Company is working to expand its footprint in the Chinese and Central American markets via commercial opportunities that are complementary to the existing arrangements in place. A number of smaller opportunities are also being pursued on a country by country basis.

Agronomy

New crop trials have commenced in North America, Brazil, China, Africa and South East Asia covering a range of attractive opportunities in each region. Numerous studies have also been completed in the period, providing greater support for the value-in-use proposition of the Company's POLY4 product and also identifying opportunities for new crops and markets.

The agronomy programme continues to validate the four cornerstones of the POLY4 value proposition; efficiency, effectiveness, flexibility and sustainability.

Admission to the Main Market

The Company has announced its intention to apply for admission to listing of its ordinary shares on the premium listing segment of the Official List of the UK Listing Authority and admission to trading on the London Stock Exchange's main market for listed securities. It has also given notice of its intention to cancel trading on the AIM market of the London Stock Exchange at the same time. A prospectus will be lodged with the UKLA and the move is expected to be completed by late April. It is anticipated that following the move, the company will be included in the FTSE UK index series from June, based on the current market capitalisation.

The Company directors believe that a premium listing will support the long-term strategy of the Company by providing the Company with a more appropriate platform for its growth and is in keeping with the nationally significant nature of the Company's Project and its market capitalisation.

For further information, please contact:

 
 Sirius Minerals Plc        Tristan Pottas 
  Investor Relations         Email: [e-mail]     Tel: +44 845 
  Manager                                                         524 0247 
-------------------------  ------------------------------  --------------- 
 Joint Brokers 
  Liberum Capital Limited     Neil Elliot,                     Tel: +44 20 
  (NOMAD)                     Clayton Bush,                      3100 2222 
                              Jill Li 
 J.P. Morgan Cazenove       Ben Davies, Jamie                  Tel: +44 20 
                             Riddell                             7742 4000 
 WH Ireland                 Adrian Hadden                      Tel: +44 20 
                                                                 7220 1666 
-------------------------  ------------------------------  --------------- 
 Media Enquiries            Jos Simson, Mike                   Tel: +44 20 
  Tavistock                  Bartlett,                           7920 3150 
                             Emily Fenton 
-------------------------  ------------------------------  --------------- 
 

About Sirius Minerals Plc

Sirius Minerals Plc is the fertilizer development company focused on the construction and development of its North Yorkshire polyhalite project in the United Kingdom. It believes the Project represents the world's largest high-grade known deposit of polyhalite, a multi-nutrient form of potash containing potassium, sulphur, magnesium and calcium. Incorporated in 2003, Sirius Minerals' shares are traded on the London Stock Exchange's AIM market (AIM: SXX). Its shares are also traded in the United States on the OTCQX through a sponsored ADR facility. Further information on the Company can be found at: www.siriusminerals.com.

This information is provided by RNS

The company news service from the London Stock Exchange

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March 28, 2017 02:02 ET (06:02 GMT)