Sirius digs deep in £2bn fundraising bid

THE FIRM behind the £1.7bn York Potash Project has appointed two investment banks to launch a £2bn fundraising bid.

The news comes just weeks after a knife-edge 8-7 vote approving the development which will see Sirius Minerals build a potash mine under the North York Moors.

According to national reports, Sirius plans to raise the financing in two phases over the next 18 months.

Moelis is advising the company on the first phase of the financing which aims to raise around £650m through a mixture of development equity and structured debt, The Telegraph reported.

Sirius has said that a number of cornerstone investors are already doing due diligence on the scheme following its success in gaining approval to proceed.

The remaining £1.3bn of the financing will come in the lower-risk second phase by which time major tunnelling works are expected to have been completed.

Sirius Minerals believes the mine will create 1,040 direct jobs, with a further 1,010 supported in the construction and development phase, and £1.2bn delivered in exports.

The plans, which have been under discussion for five years, are for a shaft to be dug a mile into the moors, near Whitby, to reach polyhalite. A 23-mile tunnel containing underground conveyor belts would then link the mining site to a processing plant in Teesside.

There is estimated to be 3bn tonnes of the mineral, which is used as a fertiliser, and which could be mined for 100 years.

Shares in the AIM-listed company have been fluctuating in value over the past few months as uncertainty continued over the scheme, ahead of the specially-convened meeting of the North York Moors National Parks Authority at Sneaton Castle in Whitby earlier this month.

Planning officers had not recommended a decision when producing their 229-page report, instead leaving it in the hands of the councillors.