Bloomberg News

Sirius Minerals Rises on Plan for U.K. Potash Mine: London Mover

September 17, 2012

Sirius Minerals Plc (SXX) rose for a fourth day, the longest winning streak in eight months, as investors warmed to its plan for a potash mine that may hold the largest deposit of a mineral used to make the fertilizer.

Sirius gained 9.4 percent to 23.25 pence at the close of trading in London, extending its advance to more than 30 percent since it announced details Sept. 3 of a proposed underground development in the North York Moors National Park in the U.K.

The design “should significantly allay fears of visual impact/environmental concerns,” Ash Lazenby, an analyst at Liberum Capital Ltd., wrote in a note to investors as London- based Sirius revealed changes to the mine proposal.

The project, near the coastal town of Whitby in the north of England, would be the second potash mine in the U.K. Its store of polyhalite, used to make sulfate of potash, may be the largest in the world, Chief Executive Officer Chris Fraser said in February.

Sirius altered plans in order to reach the ore through less intrusive vertical shafts from land now used for farming and forestry. The design will “minimize the impact on the local community and the environment,” it said.

Sirius, which was listed on London’s AIM stock market in 2005, has also evaluated land in North Dakota and Australia for mining and doesn’t plan to perform further work there “in the near future,” according to its annual report for the year ended March 31.

Production at the Whitby mine is intended to begin in 2017, according to Fraser, the former head of metals and mining investment banking at Citigroup Inc. in Australia.

The company’s stock, which rose 10 percent on Sept. 14, has more than doubled in 12 months. Liberum’s Lazenby, as well as the two other analysts who report findings on Sirius to Bloomberg, recommend buying the shares.

To contact the reporters on this story: David Risser in London at drisser@bloomberg.net; Jesse Riseborough in London at jriseborough@bloomberg.net;

To contact the editors responsible for this story: Heather Harris at hharris5@bloomberg.net. Mark Gilbert at magilbert@bloomberg.net


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