Buyers queue up to sign deals for potash

The deals are framework sales agreements and set out volume commitments ahead of formal sales contracts which will be signed closer to the time of first production, which is a standard procedure in the fertiliser industry.

The deals add up to 310,000 tonnes a year including 60,000 tonnes of sales in the UK.

Sirius Minerals, the company behind York Potash, said the agreements are with established fertiliser manufacturers and distributors, rather than traders and will remain confidential for now.

Pricing will be agreed when formal contracts are signed and will be based on market conditions at the time.

The new agreements follow a marketing agreement with KEYTRADE AG for up to 1.75 million tonnes of polyhalite a year.

Sirius said the markets covered by these agreements represent only a small percentage of the total European fertiliser market and highlight the opportunity for further sales across the UK and Europe.

It added that discussions about polyhalite supply agreements to other customers are continuing with a range of major distributors and fertiliser blenders around the world.

While these discussions are at various stages, if they reach a successful conclusion Sirius said the total demand would exceed York Potash’s initial production target of five million tonnes a year.

Chris Fraser, managing director and CEO of Sirius, said: “This further customer endorsement of the market for polyhalite is just the beginning, but demonstrates a clear need and market for this sustainable multi-nutrient form of potash.

“Customers both here in the UK and around the world are seeing significant agronomic value in our products and are encouraging us to reach production as fast as possible.”

Sirius will find out in the summer if its planning application is successful.

The new sales agreements come at a time when York Potash still faces opposition to the new mine.

Last week national park chiefs warned that the mine could face major challenges, despite developers allaying concerns over the impact on a radar base.

The Ministry of Defence (MoD) had raised fears the proposed mine could lead to subsidence which would play havoc with ultra-sensitive monitoring equipment at the nearby RAF Fylingdales.

However, Sirius has held talks with the MoD and subsequently drawn up detailed planning conditions which have now been submitted to the North York Moors National Park Authority.

The authority’s director of planning, Chris France, confirmed that the MoD is now due to withdraw its holding objections after the conditions satisfied its concerns.

Sirius has agreed to introduce an exclusion zone for mining around the RAF base, and monitoring equipment will be installed to assess vibrations.

The company is also due to submit a detailed plan to specify how it intends to carry out the blasting of the mine shafts.

Mr France stressed that formal objections, which have been submitted by both the Environment Agency and Natural England, still remain and are unlikely to be resolved ahead of a planning committee meeting to be held early in July.

He said: “These are still significant objections and it will be extremely difficult for the developers to provide the relevant information which has been requested ahead of the meeting on July 2.

“It will be a huge challenge as we are working to a very tight timescale and a decision will be made in a matter of weeks.”

The Government is lining up the air base at Fylingdales, high on the North York Moors, to be in the forefront of a global battle against rogue terrorist nations with a growing need to monitor satellites.

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