Blistering Barnacles ...
Half year results for period ended 30 June 2018 : https://otp.tools.investis.com/clients/uk/sirius_minerals/rns/regulatory...
"Post balance sheet date events:
Since the half year end the Group signed a materials handling agreement with Redcar Bulk Terminal Limited ("RBT") to provide port and ship loading services for up to 10 Mtpa, and a long-term lease of land agreement with RBT for storage facilities adjacent to the port facilities.
The Group also entered into a design and build contract with STRABAG for the remaining drives of the MTS tunnel and an EPC contract with Jacobs UK Limited for the MHF at Wilton. Procurement for the major packages is now substantially complete.
As a consequence of finalising the major procurement packages, the Company announced on 6 September that it expected its stage 2 funding requirement to increase of between US$400m to US$600m. The Company is actively reviewing the most cost effective and efficient sources of capital to fund this additional capital requirement.
On 20 July, the Company announced that it had entered into take-or-pay supply agreements with two new Chinese customers, Guangzhou Eiliseng Biotech Co Ltd and Yantai Service Agricultural Science and Technology Co Ltd, for peak contract volumes of 1.15 Mtpa and 800,000 tpa respectively. Due to its changing growth plans Yunnan Dian Huang Peony Industrial Group Co Ltd ("Dian Huang") and the Company mutually agreed to terminate their existing agreement for supply of up to 1 Mtpa of POLY4 into Yunnan and Sichuan. Eiliseng now has the rights to resell POLY4 in these provinces and to service demand from Dian Huang.
On 17 September 2018 the Group announced that it had entered into an agreement to acquire 30 per cent. equity interests in Cibrafertil Companhia Brasileira de Fertilizantes and OFD Supply Inc (the "Cibra Group Companies") for a total of 95 million fully paid ordinary shares of Sirius Minerals Plc. The agreement is linked to a take-or-pay supply agreement between York Potash Limited and the Cibra Group Companies for peak contract volume of up to 2.5 Mtpa. Completion of the arrangements is subject to the satisfaction of certain conditions precedent and are expected to take place in the coming weeks.
Year to date the Company has entered into new supply agreements increasing the peak aggregate sales volumes by a net amount of 3.8 Mtpa, subject to the completion of the Cibra agreements. This exceeds the Company's stated target to execute 2 Mtpa incremental supply agreements in 2018. The Company's total peak aggregate supply agreement volumes currently stands at 8.2 Mtpa.
The Company agreed an amendment to the Minerals Royalty Deed entered into with Hancock British Holdings Ltd ("Hancock") in October 2016 (the "MRD"). Pursuant to the amendment, the Company has received the US$250m proceeds from the drawdown of the royalty component of the MRD."
"The Group has deployed £148m during the period for the purposes of developing the Project. Total funds at the end of June 2018 were £323.4m, comprising bank deposits and cash equivalents of £263.7m and restricted cash of £59.7m."
"As at 30 June 2018, 1,221 bonds remain outstanding with an aggregate face value of US$244m representing 67 per cent. of the total number of bonds issued as part of the stage 1 financing. If fully converted, these bonds would lead to the issuance of a further 794m ordinary shares."
An emphasis of matter: https://www.youtube.com/watch?v=Jn9e-oKjmJU
"CEO of Sirius, commented: "The business made excellent progress during the third quarter of 2018, achieving a number of key milestones. Procurement is now substantially complete for the major construction packages including the STRABAG AG agreement for the mineral transport system.
"The announcement of our largest supply agreement to date with Cibra, Brazil's sixth largest fertilizer distributor, has enabled us to exceed the target peak aggregate POLY4 take-or-pay volumes intended to support stage 2 financing and further agreements are expected to be completed soon.
"During the quarter we confirmed Archer Daniels Midland, one of the world's largest agricultural processors and food ingredient providers, as our North American partner and starch supplier, which serves to underline the confidence that our world-class distribution partners have in POLY4 and its place in the future evolution of the global fertilizer market.
"The coming months are a pivotal period for the Company as we work towards fully financing the construction of our world-class long-life polyhalite project."
"The Company has now achieved peak aggregate take-or-pay contract volumes of 8.2 Mtpa which exceeds the target peak aggregate volume of 6 - 7 Mtpa intended to support the bank due diligence process for stage 2 financing"
"On 6 September, a design and build contract with STRABAG was signed for the remaining mineral transport system ("MTS") drives and an Engineer, Procurement and Construction contract was signed with Jacobs UK Limited for the construction of the materials handling facility ("MHF") at Wilton. Sirius is in advanced negotiations for the remaining scopes of work which includes the MTS fit-out and the port facilities. The Company has identified STRABAG as its preferred contractor for the MTS fit-out. Sirius currently expects that the costs of the outstanding procurement contracts will be in line with its original estimates."
"The Company continues to work with both the UK Infrastructure Project Authority and the lending banks, and the stage 2 senior debt financing due diligence process is ongoing. Bank commitment letters are expected to be obtained from commercial lenders in the fourth quarter of 2018.
The Company is preparing its revised financing plan to incorporate the additional estimated capital requirement of between US$400m and US$600m. Sirius believes that US$3bn of senior debt is the appropriate level of debt and will not seek to increase this amount. A number of financing alternatives to fund the increased capital requirement are under active consideration. Financial close of stage 2 financing is expected to take place in the first quarter of 2019."
On track to meet 2018 guidance:
"At the Woodsmith Mine site, diaphragm walling activities on the service shaft are complete and the excavation of the service shaft foreshaft is now underway and is expected to be completed in the fourth quarter of 2018. Three diaphragm walling rigs are in operation on the production shaft and activities are progressing smoothly. Excavation of the production shaft foreshaft is expected to commence in the fourth quarter of 2018. The Vertical Sinking Machine ("VSM"), which will be used to sink the mineral transport system ("MTS") access shaft to 120 meters, has arrived at site and is preparing to be launched.
The MTS portal construction at Wilton, which will facilitate the launch of the MTS drive 1 tunnel boring machine ("TBM"), remains on track for completion in 2018 ahead of the TBM delivery at site in early 2019. The initial ~125m of MTS Drive 1 will be a shotcrete lined ("SCL") tunnel development section and will be constructed using civil engineering excavation techniques. The SCL section will advance the tunnel to a depth where the geology is appropriate to launch the TBM. Design work for the MHF earthworks is complete, and earthworks are scheduled to commence in the coming weeks.
At Lockwood Beck, construction of the MTS intermediate access shaft is progressing well, with surface and basement works ongoing to prepare for the sinking of a slightly larger diameter shaft that facilitates the launch and operation of the drive 2 TBM."
Progress Presentation: https://siriusminerals.com/downloads/2018-half-year-results-and-q3-progr...
Ah, so ...
Fell out of bed.
The next Liaison Group Forum will take place at Littlebeck Village Hall, Littlebeck, Whitby, YO22 5HA on 23 October 2018 at 1pm.
The Steep ... the steeep