POLY4 Supply Agreement - Nigeria

§ 7 year supply agreement for POLY4 with ITL Trading, one of the largest suppliers of fertilizer to Nigeria

§ Pricing terms consistent with the Company's existing agreements

§ Company's aggregate peak contracted sales volume increased to 4.7 Mtpa



Sirius Minerals Plc ("Sirius" or the "Company") announces the signing of a binding take or pay offtake agreement ("the Agreement") to supply POLY4 to Intercontinental Trade DMCC Dubai ("ITL Trading").

ITL Trading is a global trading company with an active presence in Europe, Africa, the Middle East and Asia. It specializes in supplying Nigeria and West African clients with globally sourced products and services that are critical to laying the foundations for a modern economy. ITL Trading has been in business for over 25 years, and is headquartered in Dubai. It is one of the largest suppliers of fertilizer into Nigeria, and through related companies has access to distribution and logistics infrastructure including storage, port concessions and NPK blending facilities.

The supply agreement is a seven-year agreement from first production, for volumes of POLY4 increasing to 350,000 tonnes per annum in year four and provides for exclusive marketing rights into Nigeria. The agreement has a pricing mechanism linked to a relevant product benchmark and is consistent with the Company's existing portfolio of agreements. Taking the Agreement into consideration, the Company's peak contracted sales volumes has increased from 4.4 Mtpa to 4.7 Mtpa.

Chris Fraser, Managing Director and CEO of Sirius, comments:

"Africa is a huge potential market for POLY4 and we are very pleased to establish our initial footprint in Nigeria, which is the largest market in West Africa. Nigeria is positioned as the key market for fertilizer growth in the region and we believe ITL Trading will be a fantastic long-term partner for the Company.

"We continue to make good progress on all aspects of our project and are in active discussions with potential customers in other key markets such as Europe, India and Brazil in order to support the stage 2 financing."

Preetpal Walia, Managing Director of ITL Trading, comments:

"The Nigerian fertilizer market is undergoing strong growth and there is tremendous potential for multi-nutrient products which can deliver balanced fertilization. We see POLY4 as being an ideal product to meet this opportunity and are very pleased to be entering into this long-term arrangement."

House broker Shore Capital note today:
"Sirius had been looking to execute c.2Mtpa of incremental agreements in 2018, of which today’s agreement represents a significant 17.5% of that. Furthermore, Sirius’s aggregate peak contracted sales volume now stands at 4.7Mtpa (previously: 4.4Mtpa). Another three or four similar-sized deals would take Sirius into the 6-7Mtpa target range to support the Stage 2 debt financing (for which Sirius hopes to obtain initial lender commitments in mid-2018, towards execution in late 2018).

The 7-year agreement with Dubai-headquartered ITL sees volumes rising to 350ktpa in Year 4, and gives ITL exclusive marketing rights into Nigeria. Nigeria happens to be the largest market in West Africa (and is a key market for fertiliser growth in the region), and ITL is amongst the largest suppliers of fertiliser into that country, with access to distribution and logistics infrastructure (including storage, port concessions and NPK blending facilities).

The agreement’s pricing mechanism is linked to an undisclosed product benchmark, which according to Sirius is consistent with the existing portfolio of agreements. We are hopeful that once a few more contracts have been announced, Sirius will be able to unveil a higher average price than the US$145/t disclosed in late 2016. If this proves the case, it should be very positive for the share price (less in the way of contracted volumes would be required to support the Stage 2 financing; average received prices could be expected to be higher due to the steep discounts required to secure take-or-pay agreements; NPV would therefore be significantly boosted).

Sirius also reported that it continues to make good progress on all aspects of its paradigm-shifting North Yorkshire polyhalite project, and that it is in “active discussions” with potential customers in other key markets such as Europe, India and Brazil.

Shore Capital last visited the project in early May 2018, as of which time Sirius remained on time and on budget to deliver the key milestones that are first polyhalite and commercial production. We have previously opined that there will almost always be delays in projects of such magnitude as Sirius’s, and noted that the company has been doing the right thing in seeking and attempting to capitalise on opportunities to accelerate activities where possible. While Sirius is currently at development stage and still some years from becoming a cash flow-generating company, we believe that an investment in Sirius should become progressively de-risked and enjoy significant value uplift as it advances towards production."

65p!!!! Up 96%....I think not!

Quarterly progress update

§ The project remains on track to deliver first polyhalite and commercial production on time

§ The fully procured and financed capital estimate will be provided to the market once binding financing commitment letters have been executed

§ A supply agreement for Nigeria was signed during the period taking peak aggregate contract volumes from 4.4 Mtpa to 4.7 Mtpa

§ Active engagement on multiple commercial discussions for new supply agreements in Brazil and Europe

§ Initial responses received from banks participating in the stage 2 financing process are positive



Sirius Minerals Plc ("Sirius" or the "Company") provides its latest quarterly progress update. Chris Fraser, Managing Director and CEO of Sirius, commented:

"It has been a quarter of good progress as we continue to construct our Woodsmith Mine, as well as breaking-ground on Teesside. Work to deliver the stage two financing continues at pace and we are delighted to add a new, well established customer, in the high potential African region, to our growing list of partners.

"The economic and social benefits to our nationally significant infrastructure project are vast, as recently illustrated by QUOD's independent economic impact assessment, and we look forward to delivering these important and long-lasting benefits to both national and local economies.

"With commercial momentum and the development of our world-class mine continuing to progress well, we remain confident of delivering on our key milestones for 2018 and ultimately delivering on our vision to be a world-class fertilizer business."

Safety

The project's Lost Time Injury Frequency Rate ("LTIFR") stands at 4.4. The LTIFR is a measure of lost time incidents per million man-hours on a twelve-month rolling average basis. The Company is working closely with its contractors to continually improve the safety culture at all locations.

Sales and Marketing

The Company signed a seven-year supply agreement with Intercontinental Trade DMCC Dubai, a global trading company with an active presence in Europe, Africa, the Middle East and Asia, for volumes of POLY4 ramping up to 350,000 tonnes per annum in year four. Taking this agreement into consideration the Company's aggregate peak contracted volumes has increased from 4.4 Mtpa to 4.7 Mtpa.

The Company has undertaken to achieve a target level of circa 6.5 Mtpa of supply agreements in 2018. Sirius' current priority is to conclude agreements in the key markets of Western Europe and Brazil. Commercial discussions are well advanced with multiple customers in each of these regions and the Company is confident of delivering on this milestone. A number of opportunities in other regions of the world are also being progressed.

A total of 56 new crop trials have been initiated during 2018 bringing the total trials to over 320 covering 35 different crops in 23 countries.

Stage 2 financing

The initial bank due diligence process commenced early in the second quarter and has been ongoing with potential lenders reviewing the Company's information package and engaged with their independent consultants. A number of bank responses have been received with further responses due to be received over the coming weeks. The quality of the responses received so far has been positive. Once all responses have been received the Company will progress discussions with both potential lenders and the Infrastructure and Projects Authority to finalize the financing. The Company is on track to achieve financial close in 2018.

Procurement

The Company is currently in the process of evaluating proposals for each of the outstanding major scopes of work for the project. These include the materials handling facility, port infrastructure, MTS fit out and drives two and three of the MTS tunnel. The evaluation and optimisation exercise is now ongoing in conjunction with the commercial discussions associated with each package. These processes will continue into the next quarter and feed into the stage 2 financing process.

The opportunity to utilise the Redcar Bulk Terminal continues to be progressed in parallel with the option of developing a greenfield port facility at Bran Sands.

Construction progress

At the Woodsmith Mine site, diaphragm walling activities on the service shaft are complete and have now commenced on the production shaft. The excavation of the service shaft is scheduled to commence in the coming weeks. The initial 120m of the MTS shaft will be sunk using a Herrenknecht Vertical Sinking Machine ("VSM"). Preparation works, such as excavation of the guide collar, are in progress with sinking to commence during the coming quarter.

A ground-breaking ceremony, attended by the Northern Powerhouse Minister Jake Berry MP, was held at the Company's Wilton site on Teesside in late June to mark the commencement of piling work for the MTS tunnel portal. In addition to the portal construction, earthworks for support infrastructure such as power supply and welfare buildings is progressing. Tunnelling activities will commence once the portal construction is sufficiently advanced.

Cost and schedule

The project remains on track to deliver first production and commercial production on time. The Company has now entered the final phase of the procurement process involving cost and risk estimation which involves an iterative process of evaluating contractor scopes of work, commercial risk allocation and contingency requirements. In addition to this, the outcomes of this process are subject to review by the lender's technical consultant as part of the stage 2 financing process. The Company intends to provide the market with an updated estimate including contingency once binding financing commitment letters have been executed. This is anticipated to occur around the end of the third quarter of 2018.

Investor webcast

Sirius Minerals' Chief Executive Officer, Chris Fraser, will host a webcast for investors and analysts at 10.30 am today.

The webcast can be listened to live by clicking on the link below. A replay will be available on the Company's website in due course.



http://event.onlineseminarsolutions.com/wcc/r/1789152-1/AB893348F991B2213A108F28135A4224

RBT materials handling agreement and lease

Sirius signs materials handling agreement and lease with Redcar Bulk Terminal

§ Materials handling agreement signed with Redcar Bulk Terminal Limited to provide port and ship loading services for up to 10 million tonnes per annum

§ Long-term lease of land for storage facilities adjacent to port facilities

§ Arrangements will provide greater flexibility in storage and port operations

§ Reduces construction risk and capital expenditure requirements during the current construction programme which will have stage 2 financing benefits

more.....

Liberum Capital Buy 33.18 60.00 - Reiterates

Berenberg today initiates coverage of Sirius Minerals PLC (LON:SXX) with a buy investment rating and price target of 50p.

StockMarketWire.com
Sirius Minerals said it had agreed to supply fertilizer to the Chinese companies Guangzhou Eiliseng Biotech and Yantai Service Agricultural Science and Technology from its Woodsmith Mine in Yorkshire.

The binding take-or-pay agreements both had 10-year terms, running from first production, with pricing 'linked to relevant product benchmarks', the company said.

Eiliseng Biotech and Yantai Service would purchase up to 1.2m tonnes per year and 800,000 tonnes per year, respectively.

The deals pushed the company's aggregate peak contracted take-or-pay sales volumes up to at least 5.7 Mtpa, up from 4.7 Mtpa.

'In China, government enforced changes in agricultural practices and planned farm consolidation will support the drive to restore soil efficiencies through the adoption of more balanced and environmentally sustainable fertilization practices,' Sirius said.

Sirius said its trials had demonstrated the benefits of its POLY4 product as a multi-nutrient fertilizer, with a low environmental impact that delivers greater nutrient uptake.

A 2 year high with decent volume.

It certainly looks promising with a good few saying "buy"

but don't expect instant gratification

Lowest price paid 7.40p over 3 years ago - I can wait :-)

Barchart Opinion

Partnership with Archer Daniels Midland Company

Expanded partnership with Archer Daniels Midland Company

§ Archer Daniels Midland Company ("ADM"), a Fortune 500 US-based agri-business, confirmed as Sirius' North American POLY4 off-take partner

§ Sirius signs agreement with ADM for the supply of starch-based binding agent to be used in the production of Sirius' POLY4 product



Sirius Minerals Plc ("Sirius" or the "Company") announces the signing of an agreement with ADM for the supply of binder for its POLY4 product and names ADM as the Company's North American off-take partner.

Archer Daniels Midland Company (NYSE: ADM), a Fortune 500 company (currently ranked 48th) is one of the world's largest agricultural processors and food ingredient providers, with approximately 31,000 employees serving customers in more than 170 countries. With a global value chain that includes approximately 500 crop procurement locations, 270 ingredient manufacturing facilities, 44 innovation centers and the world's premier crop transportation network, ADM connects the harvest to the home, making products for food, animal feed, industrial and energy uses.

Chris Fraser, Managing Director and CEO of Sirius, comments:

"Sirius has been working with ADM for more than four years and today's announcement further strengthens our relationship by securing ADM as an important supplier and as a customer aligning our interests for the long-term and demonstrating the significant role POLY4 will play in the world fertilizer markets."

ADM named as North American customer

more.....

Liberum Capital Buy 36.44 60.00 - Reiterates

What about the prospect of reaching the all time high of about.46 reached about 2 years back ?

Looking a bit "gappy" and over bought?

Arguably a breakaway gap - time will tell.

https://ftalphaville.ft.com/2018/08/07/1533614400000/Sirius-Minerals--money-for-a-hole-in-the-ground/

Very interesting article on SXX and discussion afterwards. Many different opinions and 'experts'. (You need to be registered with FT to read).