Anglo American (LON:AAL) major design changes to the vast fertilizer project being built聽beneath the North Yorks Moors national park in England, which it acquired last year when buying British junior聽Sirius Minerals.
The company, which has so far excavated about two-thirds of a 37-km-long tunnel between the Woodsmith mine and a port on Teesside, said it will inject a further 拢530 million ($700m) into the project.
The additional investment will be used to continue the sinking of two main shafts and the development of underground areas to accommodate increased production capacity, it said.
Anglo added the planned changes, a result of a detailed technical review, would result in a 鈥渄ifferent construction and production ramp-up schedule.鈥�
鈥淲e expect to have completed our design engineering, capital budget and schedule at the end of 2022,鈥� chief executive Mark Cutifani, who is being replaced in April by Duncan Wanblad, said in the statement.
鈥淲e will then submit the full project to the board.鈥�
Changes at the top
The diversified miner is also modifying the leadership at Woodsmith ahead of the full project execution phase. Tom McCulley, who has led the development of the Quellaveco copper project in Peru, will take over from Chris Fraser as the chief executive of the company鈥檚 new Crop Nutrients division.
Fraser, who led the project for 12 years, will take on a new 鈥渟trategic projects role鈥� at Anglo.
Woodsmith鈥檚 previous owner estimated the project required about $3.3 billion for completion, with first production slated for 2024.
The project, England鈥檚 largest new operation in decades, could also become one of the world鈥檚 largest in terms of the amount of resources聽extracted. Woodsmith will generate an initial 10 million tonnes per year of polyhalite, a multi-nutrient fertilizer, containing four of the six key elements needed for plant growth 鈥� potassium, sulphur, magnesium and calcium.
The involves sinking two 1.5km-deep mine shafts to tap the deposit of polyhalite located underneath the North York Moors National Park, and building a tunnel to take the material to the closest export terminal.
RBC Capital Markets analyst Tyler Broda said the fact that Anglo is aiming for a larger than planned operation reaffirms the bank鈥檚 view that the miner is confident about the end market for polyhalite.
鈥淭his, however, will place an asterisk over potential capex levels in the 2023-26 time frame. Kicked to touch once again, we won鈥檛 know full details until the end of 2022,鈥� Broda wrote.
Woodsmith was originally expected to create about 1,800 jobs during construction and 1,000 permanent positions once opened, but Anglo鈥檚 changes are likely to increase such figures.