Investors line up to support potash mine in region

Sirius Minerals bought York Potash for £25m in January, in order to gain access to mineral rights on the North Yorkshire coast.

Sirius plans to open a potash mine between Scarborough and Whitby, which would be the first new mine of its kind in the UK for 40 years.

Yesterday the company’s finance director, Andrew Lindsay, said: “We have received planning permission from the North York Moors National Park Authority for drilling at four different sites and two further sites will come for approval in August.

“Drilling at the first site will start shortly. A scoping study has also been started, which is being carried out by Ercosplan, who are international experts in potash mine development and geology.

“The project development is proceeding according to plan, and if all the necessary work is completed, and approvals are received successfully, the mine should come into production in about five years’ time.”

Mr Lindsay said the mood of the market was positive, but the project was still at a very early stage.

He added: “We have had a few localised objections (to the proposals), but we try as much as we can to minimise any impact on the environment and the local people.”

Altogether, Mr Lindsay said he believed the mine would create 1,000 jobs, and support a further 4,000 jobs in the neighbouring area.

In January, Scarborough Council leader Coun Tom Fox said the announcement was “tremendously exciting” and would provide a massive economic boost.

In the year ended March 31 2011, the company raised £24.3m through three separate placings.

“High quality institutions” now hold some 15 per cent of the company’s issued share capital, Sirius said.

Chris Catlow, the company’s chairman, said: “For the year to March 31 2011 the company generated a consolidated loss of £7.1m, some £3.3m larger than last year, which reflects the increased level of activity in the company this year and a £4.8m charge for share based payments. At the end of the year the group held £21m in cash.”

He added: “I am pleased to report your company is now well funded and on the way towards achieving its goal of becoming the New Potash Powerhouse.

“The coming year promises to be an exciting one for all of us at Sirius.”

“With the acquisition of the York Potash Project in January 2011 the company acquired a project with enormous potential to become one of the world’s most significant potash producers.

“Sirius will focus its efforts to add shareholder value by concentrating on advancing York Potash to production as quickly as possible.”