UK-based mining company Sirius Minerals has been forced to cancel a $500m bond issue after the UK government refused to back its potash mine in the North Yorkshire Moors.
Speaking to the Financial Times (FT), Sirius Minerals chief executive Chris Fraser said: “If we go all the way to March and we have not brought additional funding into the project, then obviously at that point in time we will be down to a minimal number of staff.
“Anything to do with the UK and major capital projects is a big challenge for any financing at the moment.”
A government spokesperson added: “We cannot comment on commercially sensitive matters. All requests for financial support must meet necessary lending criteria.
“When examining any request for financing, we have to assess the potential of a project against the need to protect taxpayers’ money.”
Sirius will now look for a partner in the private sector to fund the project, naming sovereign wealth funds such as EuroChem or a major mining group like BHP as possible investors.
News of the bond issue cancellation hit Sirius’s share price hard as it lost over 50% of its value, falling from 10p to 4.67p a share on 17 September. At the time of writing, Sirius’s stock price had fallen by a further 15% from 3.97p a share, giving it a current market capitalisation value of just over £277m, having been valued at £1.7bn in August 2018.
