London-listed Sirius Minerals on Friday announced that it had signed a ten-year supply and distribution agreement with a State-owned Qatari company, sending its share price up 3.5% to 3.55p each by 15:30.
Qatar Chemical and Petrochemical Marketing and Distribution Company (Muntajat) will sell and distribute POLY4 into Africa, Australia, New Zealand and certain remaining Middle-Eastern and Asian territories.
“This new supply agreement with Muntajat provides us with access to a number of new markets for POLY4 and further underpins the large scale, international market appetite for POLY4, lifting our aggregate peak sales volumes to 13.8-million tons a year,” said Sirius MD and CEO Chris Fraser.
In addition to the supply agreement, Sirius is working with Muntajat to explore the downstream combination of POLY4 with nitrogen products in Qatar and the UK to create a value-added multi-nutrient fertiliser.
Qatar is already a major investor in Sirius through Qatar Investment Authority.
The agreement comes as Sirius has been working on a strategic review to keep its polyhalite project in Yorkshire alive. Last month, the company pulled a planned $500-million bond offering.
The Woodsmith project area is said to contain the largest, highest grade resource of polyhalite to be found anywhere in the world at 2.66-billion tonnes.
The Woodsmith mine is expected to operate at ten-million tons a year by 2024, expanding to 20-million tons a year by 2029. Construction of the mine started in May 2017.