Woodsmith Project: Major update on how £7bn Yorkshire scheme is affected by Anglo American merger
Plans for a “generational” £7bn Yorkshire mine project will continue to progress as the firm behind the scheme heads for an enormous global merger.
Anglo American has announced plans for a “merger of equals” with Teck Resources to form the Anglo Teck group, which will be one of the world’s largest copper producing companies. Both firms are recommending their shareholders back the merger plan.
Its global headquarters will be located in Vancouver, with corporate offices to support the group in London and Johannesburg.
The announcement of the plan confirmed the planned development of the Woodsmith project will continue under the new organisation.
The statement said: “Anglo Teck will continue to progress the development of the Woodsmith project in the UK with its ongoing potential to be a generational asset in crop nutrients.
"Full development remains subject to meeting stringent investment criteria for risk-adjusted value, including syndication to one or more investment/strategic partners.”
The Woodsmith project involves the creation of a new mining site near Sneaton to the south of Whitby and a 23 mile tunnel that will transport a naturally occurring mineral, polyhalite, to new processing and shipping facilities on Teesside.
It is intended the product will be sold as a fertiliser suitable for organic use that can boost crop yields and aid more sustainable farming.
In May 2024, Anglo American announced a shock decision to save costs by slowing work on the scheme, despite nearly 18 miles of the 23-mile tunnel already being built, with a feasibility study into the project ordered.
In July this year, Anglo American said “project ramp up” for Woodsmith was expected from 2027.
Anglo American has been in the process of simplifying its business model after fending off a £39bn takeover bid from rival mining firm BHP.
The company has been in the process of selling off a number of its entities, including its De Beers diamond wing, to focus on its core copper, premium iron ore, and crop nutrients divisions.
Duncan Wanblad, Chief Executive Officer of Anglo American, said of the merger plan: "We are unlocking outstanding value both in the near and longer term - forming a global critical minerals champion with the focus, agility, capabilities and culture that have characterised both companies for so long.
"Having made such significant progress with Anglo American's portfolio transformation, which has already added substantial value for our shareholders over the past year, now is the optimal time to take this next strategic step to accelerate our growth.
"We have a unique opportunity to bring together two highly regarded mining companies whose portfolios and capabilities are deeply complementary, while also sharing a common set of values.
"We are all committed to preserving and building on the proud heritage of both companies, both in Canada, as Anglo Teck's natural headquarters, and in South Africa where our commitment to investment and national priorities endure. Together, we are propelling Anglo Teck to the forefront of our industry in terms of value accretive growth in responsibly produced critical minerals."
Jonathan Price, Chief Executive Officer of Teck, said: "This merger of two highly complementary portfolios will create a leading global critical minerals champion headquartered in Canada - a top five global copper producer with exceptional mining and processing assets located across Canada, the United States, Latin America, and Southern Africa.”