Yahoo Finance Sirius Minerals to use former Redcar steel port in boost for Tees Valley
Fertiliser miner Sirius Minerals hopes to breathe new life into the dock that once served the iconic Redcar steelworks, striking a deal to export its future product through the Teesside facility.
The FTSE 250 company, which plans to build a giant mine in the North Yorks Moors, has signed a materials handling agreement and a 30-year land lease with Redcar Bulk Terminal (RBT).
Sirius wants to use the port to load and ship 10m tonnes per annum of its fertiliser blend from 2021. The deal will massively boost the traffic through the terminal, which has been running below capacity since its biggest client, the adjacent steelworks owned by SSI UK, shut its doors in 2015.
The closure of Redcar steelworks dealt a huge blow to the Tees Valley, resulting in the loss of 1,700 jobs and many more in the supply chain.
Sirius hopes to become a major employer in the region once it begins construction of two 1,500m shafts in the North Yorks Moors and a 23-mile tunnel to Teesport, which will transport its fertiliser.
It hopes to convince lenders to put up £2bn in “stage two” financing later this year, having already raised £1.2bn to advance development of the Woodsmith mine. The project eventually hopes to turn out 20m tonnes of polyhalite a year. The fertiliser is a blend of potassium, calcium, magnesium and sulphur.
Using RBT will lower some of Sirius’ upfront costs and remove some of the complexity from its highly ambitious scheme.
It also owns the vacant site next to RBT, which could be built into a handling dock once its production reaches full swing some time in the next decade.
Chris Fraser, chief executive of Sirius, said: “ The RBT facility has been underutilised since the closure of the steelworks and this agreement will ultimately help us deliver tremendous economic benefits for the region."
RBT, on the south bank of the mouth of the River Tees, is one of only four ports in the UK capable of handling giant capesize vessels. It can handle up to 12m tonnes of bulk material per year but is loading just 2-3m tonnes at present.
Sirius shares dipped 0.18pc in afternoon trade to 33.18p.
