Sirius Minerals signs five-year deal in Central America

18th Aug 2014 14:37

Potash development company Sirius Minerals has signed a five-year agreement with a large Central Americn fertilizer distributor, the group announced on Monday.The so-called "take or pay offtake agreement" is structured to align with York Potash's schedule and it is based on the supply of 150,000 tonnes-per-annum (tpa) in the first 12 months, rising on an annual basis to 250,000 tpa in the fifth year of production."This agreement continues to extend the global sales reach of polyhalite and means we are now partnered with an organisation that controls a substantial proportion of the Central American crop input market," said Chris Fraser, managing director and chief executive of Sirius."Our customer commitments now exceed five million tpa, with additional options for 750,000 tpa. We are having a number of ongoing discussions with customers seeking to tie down supply agreements for this important multi-nutrient mineral."Sirius said the agreement, which will initially run for five years but can be extended for a further five, will allow its new partner to distribute polyhalite through its various networks of local and regional companies.Guatemala, Belize, El Salvador, Nicaragua, Honduras, Costa Rica, Panama and Colombia are among the regions the fertilizer distributor operates in.Sirius shares were up 6.98% to 11.50p at 14:22 on Monday.DC