Sirius signs deal with China

SIRIUS Minerals, the company behind plans for a huge new potash mine near Whitby, has today announced it has reached a major international milestone.

Sirius has entered an offtake agreement with a company in China. The agreement with Yunnan TCT Yong-Zhe Company (TCT) – one of the fastest growing domestic agricultural products companies in China – is for the sale of 1 million tonnes per year of polyhalite for 10 years from 2017.

The initial price remains confidential but Sirius said it is in line with its assumptions used for its ‘base case’ NPV modelling.

The agreement contains certain conditions including collaboration on testing and results from crop trials of polyhalite in Yunnan and also Chinese government approvals.

Yu Yan Qing, CEO of TCT, said: “We see great potential in polyhalite as an organic multi-nutrient fertilizer that can provide a competitive advance in agricultural efficiency and helping to increase crop yields and quality in China.  This is an important step for a long-term and prosperous relationship between TCT and Sirius Minerals.”

Chris Fraser, managing director and CEO of Sirius, said: “This is a major milestone for the company that further demonstrates the market for polyhalite, supports the economics behind the project and will ultimately help to give confidence in the financing for construction.
 
“The offtake agreement is the latest endorsement of the global demand for polyhalite, its unique multi-nutrient qualities and the role that balanced fertilisation can play in the largest fertilizer market in the world. We look forward to working with TCT to realise the outstanding potential for polyhalite.”