LONDON (Alliance News) - Sirius Minerals PLC on Tuesday outlines changes to the USD3 billion stage 2 debt financing for its Yorkshire fertilizer mine to modify risk allocation amongst various lenders.
The company is developing the Woodsmith polyhalite fertilizer mine near Whitby, England.
It said the USD3 billion debt financing structure contemplates three tranches of debt that will be drawn sequentially on key mine construction milestones.
The original financing structure had two equal tranches of debt, one commercial bank tranche and one tranche guaranteed by UK government.
Under the new financing structure, the first tranche will be a debt capital markets tranche, the second a commercial bank tranche, and the third being the UK government guaranteed bond tranche.
"This structure is designed to reduce both the risk and the quantum of any UK Infrastructure & Projects Authority guaranteed bond tranche to the taxpayer as by this time we will be past the major construction risks and polyhalite sales underway," Sirius Minerals said. It added that it continues to progress on all options to secure additional capital.
"Executing our stage 2 financing plan remains our priority. We continue to make progress towards obtaining stage 2 financing commitments and are working constructively with all relevant parties to achieve this. The process with the lenders is continuing this quarter as we work through the due diligence reports with the lending group and progress discussions on the revised debt structure," said Managing Director & Chief Executive Officer Chris Fraser.
Sirius Minerals remains on track to achieve first polyhalite and commercial production on time and in line with previously announced cost schedule.
The fertilizer producer said it has made considerable construction progress at the Woodsmith mine and has completed procurement of major construction packages related to the stage 2 debt financing process.