North Yorkshire mine "on time and on budget"

The Red Arrows flying over Sirius Minerals exploration drilling rig at its North Yorkshire polyhalite project
The Red Arrows flying over Sirius Minerals exploration drilling rig at its North Yorkshire polyhalite project
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Sirius Minerals, the developer of the ​£10bn ​North Yorkshire polyhalite mine​, ​said production is scheduled​ to start on time and on budget.​

The firm said there had ​been a two month delay ​in​ excavat​ing​ the ​Woodsmith ​mine due to ​bad​ weather​, but it is confident it can make up the ​lost ​time. Production is due to start in 2021 and the group has a budget of £2.9bn.

Sirius said that ​​diaphragm walling​ ​activities ​(the process by which mud is replaced by concrete) ​are a​round two months behind schedule following delays in commissioning the equipment and adverse weather conditions. The ​c​ompany ​said it ​is confident that this small loss of time will be recovered over the remainder of the project schedule.

​Sirius said t​he application for ​“minor material​“ amendments to the original planning application ​has been unanimously approved by the local planning authority. This approval covered changes to the foreshaft and surface layout designs at the Woodsmith site.

The firm said the site preparation scope of work at the Woodsmith and Lockwood Beck sites is now substantially complete. A number of minor activities remain ongoing and will be completed in 2018. .

Analyst Yuen Low at Shore Capital said: “For us, the key takeaways from today’s quarterly update are that the paradigm-shifting North Yorkshire polyhalite project remains on time and on budget and that Sirius has generally achieved what it had set out to do.​“

Mr Low said that whilst the company has made some notable achievements, such as securing a take-or-pay off-take agreement with Wilmar and obtaining Section 73 approval from the North York Moors National Park for the revised shaft construction plans, ​there are potential concern​s​ ​for​ investors.

​He said these include the signing of the shaft sinking contract, which Sirius had hoped to have ​achieved​ by the end of 2017 but ​it ​currently remains unsigned.

​“​This is not yet causing scheduling issues, but Sirius is understandably keen to have this executed as soon as possible to avoid any potential negative impact on the critical path,” said Mr Low.

Sirius said it is still working to finalise the shaft sinking contract.

“This activity is the key focus of management’s attention and all avenues are being explored to ensure a shaft sinking contract will be executed as soon as possible and the impact on the overall construction programme is minimised,” the firm said.