The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
Anna Turley MP for Redcar took the trouble recently to frame 2 very specific and pointed questions. This is the Government's non-response which completely ignores the 2 issues actually raised - lazy, pathetic and dismissive.
"Asked by Anna Turley on 15 October 2019
Q.1 To ask the Secretary of State for Business, Energy and Industrial Strategy, what recent assessment he has made of the effect on the local economy of his Department's decision to not support a finance package for Sirius Minerals' Woodsmith Mine project.
Answered by: Nadhim Zahawi 21 October 2019
Sirius Minerals have recently made a statement to adjust their work programme and undertake a strategic review of the project. The Government will continue to monitor the progress of the work. Sirius Minerals have stated they will continue to find alternative sources of investment so that they can complete the Woodsmith Mine project.
Q.2 To ask the Secretary of State for Business, Energy and Industrial Strategy, what estimate he has made of the cost to Sirius Minerals PLC of the decision by his Department not to support a finance package for that company's Woodsmith Mine project.
Answered by: Nadhim Zahawi on 21 October 2019
Sirius Minerals have recently made a statement to adjust their work programme and undertake a strategic review of the project. The Government will continue to monitor the progress of the work. Sirius Minerals have stated they will continue to find alternative sources of investment so that they can complete the Woodsmith Mine project."
I await the fulsome answer to our Petition with baited breath.
RF
Excellent. Just another 89,989 and we can have a Debate in the House. Otherwise we may just have to settle for the reasoned Response "Treasury says No". Keep counting.
RF
These are the 2 Qs asked by Redcar MP on 15 Oct, replies awaited:
Asked by Anna Turley (Redcar)Asked on: 15 October 2019
To Department for Business, Energy and Industrial Strategy:-
615
To ask the Secretary of State for Business, Energy and Industrial Strategy, what recent assessment he has made of the effect on the local economy of his Department's decision to not support a finance package for Sirius Minerals' Woodsmith Mine project.
616
To ask the Secretary of State for Business, Energy and Industrial Strategy, what estimate he has made of the cost to Sirius Minerals PLC of the decision by his Department not to support a finance package for that company's Woodsmith Mine project.
Also, the issue of water ingress referred to on the Sirius Investors FB was posted on8 October(or thereabouts) and refers to the issue being at Lockwood Beck, where work had supposedly come to a halt "as a result".
RF
Thank you Lost- that does make more sense to me
ATB Rf
Yes
Hi Casapinos.
Just to take a simple view of your point and the figures cited- if the SP were 10x current price, then your concerns as to ratio would be dealt with would they not? So if the SP returned to 36p, that would resolve the isuue. And is that such an unreasonable target for the SP if all the funding was in place, given the progress that is being made with construction.
After all 36p did not seem such an outrageous price to investors when funding was believed to be in hand, even when construction carried out was minimal compared to today. I appreciate that there are "chicken and egg", or Catch 22 issues here, but surely any lender/investor would follow the point that the current SP reflects where we are now, NOT where we are likely to be with funding arranged? So I am not really sure of the relevance of this ratio to Sirius' present circumstances. This is not to attempt to diminish the difficuties however, unfortunately.
ATB RF
Here it is, as printed an in all its inaccurate nonsensical tosh-ness, from the Business section. contrast Times Energy Editor Emily Gosden's recent series of measured articles.
" Sirius still in a hole
Days after having a dig at internet bulletin bullet boards, Sirius Minerals set investor forums abuzz with news of a potentially life-saving agreement. The troubled miner, which wants to extract potash from a mile beneath the North York Moors, said that it had signed a deal with a fertiliser company owned by the Qatari state. The two-tonne-a-year commitment lifted Sirius’s bombed-out share price by 6 per cent.
The jubilation feels premature. Before Sirius can begin delivering its polyhalite fertiliser, it must revive its shelved $3.8 billion financing plan. Another note of caution: Qatar’s sovereign wealth fund also happens to own an equity stake in Sirius. The Gulf state has every incentive to keep Sirius’s star alive." simon.duke@thetimes.co.uk
You are very welcome LITC. I have just emailed Emily Gosden to thank HER for writing her balanced and relatively comprehensive piece
Just to correct a reference I made to a stunning pic from the Times. The shot I referred to- an impressive, unimpeded view of a mile of lined MTS tunnel comes from the Times reporter's own Instagram page- she was on site at Wilton very recently and either she or her photographer must have taken this great pic. Go to https://www.instagram.com/emily.gosden if you wish to view it- its the first pic to come up.
RF
Bloody hell Dodger- tough love or what!!!. I agree with you though, I think.
ATB RF
So thats the article in 3 parts.I rcommend looking at the articles online if you can. Yesterdays first carried a stunning photo of the tunnel showing an unrestricted view of the lined tunnel back for a mile to a pinprick of light at the far entrance. Taken by a Times photographer and therefore not appearing on Sirius media pages or elsewhere. Todays article carries another tunnel pic and very clear diagrams of the mine and connecting MTS. It is a very positive and supportive piece of journalism in my view. From her Instagram pics it is clear she has an interest in things Northern- lots of photos of the Dales, Yorkshire abbeys, Brimham Rocks etc. I think the pieces have been illuminating and wel balanced. I wondered if CF's remarks about the BB,s (especially "Shut them down!", if he really said that), reflect the stress he must me under at present, and the article bears out just how much pressure he is under. I really feel for the guy- it is so easy to criticise what appear to be errors of judgment- the fact is the mine IS there- without CF there would just be field and moorland, and a very smug looking Tom Stephenson. The article highlights just how personally committed CF is to success- we shoud give him a break.
ATB RF
“I have no other assets. I have a house with a very large mortgage on it, I don’t have any other shares, I don’t have any other investments.
Mr Fraser was nursing a sore elbow when he met The Times, injured through “too much swimming”. Last month, before the announcement that its funding plan had failed, he and Sirius’s general counsel and treasurer swam to France in a relay team. “It took us just under 12 hours. At the moment, we are the fastest three-man crossing of the year by one minute.”
Such “ridiculous physical challenges” were, he said, his way of dealing with stress — levels of which he admitted were now at an all-time high. “There’s so many more people reliant on us. The fact there are 1,200 people whose lives and their families have been impacted by this, it does take a terrible toll.” Were the project to fail, he has “no idea” what he would do, but he doesn’t believe it will come to that. “If you start doubting, or believing you can’t do something, the likelihood is you’re not going to be able to do it."
CONT,D“As you’d expect there’s an awful lot of people on the site who are invested in the project literally,” said Mr Smith, who has “a fair bit of my own money sunk in it. That’s a double-edged sword. You’ve got people that absolutely want to do the right thing by the business because they’re not just employees but also owners of the company. The flip side is it’s double the worry.”
Workers have taken heart from the fact this tunnelling is still going on, even as other aspects of the project have been paused, although Sirius won’t say how long it can afford to do so. Indeed, Mr Smith argues that it helps to have “a degree of control over your own destiny”. The tunnelling has been going so well so far that he now believes Sirius could scrap plans for a third boring machine, which had been due to tunnel from the middle. That could help to reduce costs and potentially help the company to secure financing.
Up at the mine site in the national park, the ramifications of failure would be all the more dramatic. Here two enormous cylindrical holes have already been excavated, ready to house the equipment that would sit above ground in a normal mine.
The visual impact on North York Moors national park has been minimised “As part of minimising the visual impact, we have created a large opening at the top, which is 35 metres diameter and 45 metres deep,” Graham Clarke, 56, operations director, said. From each of these, mine shafts will be sunk a mile down to the polyhalite; one has already been started.
If Sirius fails, it will have to use its final ring-fenced funds to fill in these holes. “We have no expectation that that’s what we are going to have to do. As with every other challenge we’ve met on this project, we expect we will come through this,” Mr Clarke said. “We will do it.”
The idea for the Woodsmith mine was born in a converted bedroom in Sydney, where Chris Fraser, the Sirius Minerals boss, used to live and from where he commuted for the first two years of the project (Emily Gosden writes).
“I was basically two weeks here, one week seeing people like customers in China or North America, and then one week at home getting over jetlag. I was a wreck.”
Born in Britain but raised in Australia, Mr Fraser, 45, worked in banking, financing iron ore, coal and fertiliser projects, until 2009, when he left to set up his own business. Scouring the world for opportunities, he was alerted to the existence of ICL’s Boulby potash mine in North Yorkshire and decided to explore the potential of untapped deposits near by. He hired Peter Woods and Rick Smith — the veteran geologists after whom Sirius’s mine is named — who mentioned that the area also contained a “massive” deposit of polyhalite, deemed to be “of no commercial value”.
Mr Fraser disagreed and the project grew from there. Almost a decade on, he has “everything” invested in it, both financially and professionally — he owns about 1.8 per cent of the company. CONT'D
Bit of confusion over the 3 Times articles, 2 yesterday, 1 today, all from Emily Gosden who is their Energy[?] Editor. Here is the latest. Incidentally, I spent £3 to get 3 months online access to Times- starting to look good value and offer still on, I believe:-
"Sirius Minerals still sees a light at end of the tunnel Despite running low on cash the miner continues to work underground on its ambitious project.
More than a mile into a tunnel from the Wilton industrial estate near Redcar, the Stella Rose boring machine is continuing to eat its way through the mudstone. It bores through one and a half metres at a time, chucking the rock out behind it on to a conveyor belt to the surface, then pauses as six three-tonne sections of curved concrete tunnel wall are slotted into place, wedged together like a Roman arch.
If Sirius Minerals’ $5 billion mining project is to succeed, this tunnel will need to extend another 22 miles south-east to near Whitby, where the company plans to tap a huge deposit of polyhalite from deep beneath the North York Moors national park. The tunnel will be used to transport the mineral for processing at the Wilton site before it is exported for use as a fertiliser in a project that Sirius Minerals claims could generate £100 billion for the UK economy over the next half a century.
The work down here, about 60 metres beneath the surface and getting deeper, is hot, noisy and, like all mining projects, potentially risky. We are handed emergency breathing apparatus to carry as we take the service train down into the tunnel and are shown the claustrophobic “refuge chamber” with food and water supplies into which workers could flee in the event of a fire.
According to Duncan Smith, 47, Sirius’s area project director for Teesside, it has done everything possible to minimise such a risk: “There’s sprinklers and fire curtains — and the philosophy is you put as little as possible in here that can actually catch fire.
“The things you’re concerned about are the power cables and the insulation on those, and the back-up diesel generator — but there’s a limited amount of time those things could burn for. The conveyor belt is designed to be self-extinguishing.”
In truth, the biggest risks to the project at the moment are financial. Last month Sirius was forced to admit that its $3.8 billion fundraising plan to see the project into production had failed after it was unable to complete a crucial $500 million issue of junk-rated bonds, sending the company’s shares plummeting. It has embarked on a review of the project and of funding options and, as The Times revealed yesterday, has already laid off 300 of its 1,200 workers to save cash. It is progressively stepping down operations before it runs out of money altogether in six months.
From the back end of the Stella Rose, you can still just about make out daylight at the end of the tunnel. If Sirius fails to find the cash it needs, that will have to be capped off and abandoned.
CONT'D
Hi JonesRichard
Not sure I can square your "take" on the Article with what CF actually said, but on balance, and pending anticipated end of month RNS I will simply adopt your position if I may, since it is at least very clear and optimistic, and could well be what CF might have said had he not had his management-speak hat on- who knows.
ATB RF
Thank you Cranleigh, and Bellers.
Your analysis Cranleigh seems to be that CF is identifying a 6 month period after the Review to put alternative finance in place ("execute off the back of that [the review])"
But a date 6 months on from a review completed on say 31 October, is 6 weeks longer than the maximum period for which we have funds to keep the project operational according to the 17 September RNS.
So we shall have closed down on 16 March '20, but on that date, and for up to 6 weeks after that, we will still be discussing the funding we might have needed to keep us operational.
Have I got it now?
RF
From the Times
"Mr Fraser, 45, [ do we need to know this?] said that a quarter of its 1,200-strong workforce had been let go [sacked] but he also said he aimed to complete the review far sooner:-
“The review is, let’s say, up to a six-week programme. It’s a six-month period to execute off the back of that. I’m hopeful that by the end of October we’re in a position where the strategic review will have reached a series of outcomes that we can then start talking about.”
Can someone with a degree or experience in management speak please explain to me what all that means please. What (or possibly who) is going to be executed off the back of the review? More negotiations for funding ? (can we all stand 6 months more of those?) or is it actual construction he is on about? or something else?
Confused as ever. ATB RF [65 and a bit]
Thank you Dodger. Is there a full stop intended after "It will"? If not, what is the "it" that you refer to?
I did genuinely laugh out loud about not being so impatient though, having been invested in this since 2012!
ATB RF
Listen Its a simple question. How many times have I got to ask? Does nobody have an answer? Why are you all toying with me? Its the boring shaft road header or something- it goes down the existing big hole, finds polyhalite, and rescues my life. Its quite simple. Why will no one tell me if its happening? Tristan? Mr Fraser? Whitby Gazette? Anybody?
OK, I am a bit stressed at the moment.
ATB RF
d.
Thought I had counted remaining characters, but no.