Secondary recovery phosphate rock producer Mineral Development LLC, Bartow, Fla., tapped into a reserve fund to pay bondholders, according to a regulatory filing by the trustee, UMB Bank NA, on Jan. 3. The trustee used $5.1 million from a debt service reserve fund to make a Jan. 1 debt service payment, the filing said, with about $3.9 million remaining in the fund.
The borrower sold $90 million of debt through the Polk County Industrial Development Authority in 2020. About $85 million of that is still outstanding, according to data compiled by Bloomberg.
MDL broke ground on its $70 million secondary recovery phosphate rock production facility in Polk County, Fla., in 2021 (GM April 2, 2021). The plant is designed to produce 1.2 million st/y of high-quality phosphate rock. MDL’s facility is the first independent phosphate beneficiation plant built in the US in more than 30 years.
The MDL plant started full production in May 2023 and began shipping product to The Mosaic Co. in Tampa, Fla., under a long-term offtake agreement.
While some of the rock is committed domestically, significant volumes will also be available for export. MDL in June 2023 inked a deal with Houston-based Sesco Cement Inc., which will build a dedicated 40,000 st storage building on its 15-acre site at its Red Wing facility at the Port of Tampa. It has committed to handle up to 450,000 st/y of export rock. In addition, MDL will install its 200 tph dryer at the facility to dry rock to 2% moisture to meet customer needs.
MDL has a long-term, exclusive agreement to extract phosphate rock from land owned by Clear Springs Land Co., Winter Haven, Fla. Clear Springs bought the previously mined land from IMC-Agrico, a predecessor of Mosaic, in 1999 for $8.2 million (GM Sept. 13, 1999). Clear Springs has approximately 18,000 acres in Bartow, midway between Tampa and Orlando and within 100 miles of Port Canaveral.
An initial 4,400 acres will supply 18.5 million st to the 30-acre plant site. More Clear Springs and neighboring acreage is expected to supply up to 10 million st for the project and expand the reserve life 20 years or more. MDL said in 2021 that it was exploring additional Clear Springs and neighboring acreage to accommodate a possible second plant.
Secondary recovery reprocesses old mine tailings into high-quality feedstock for fertilizer production. MDL estimates that the process can recover up to 12% of the rock that was missed during the initial mining.
The project only extracts material from land that has been previously mined, the vast majority of which was disturbed before mandatory reclamation regulations. MDL’s operations will primarily use surface water from existing ponds, employ state-of-the-art water recycling methods, and restore the old mining land to current DEP reclamation standards. The process helps restore the land to its original state with native vegetation and natural surface water flow while providing high-grade product.
The company said since the project is on previously mined land and is not a greenfield, it has been well received by regulatory agencies, activist groups, local authorities, neighbors, and landowners.
In October 2020, MDL closed on $118 million in financing that funded the construction of its first plant and provided the working capital necessary to start up operations. It was raised via the $90 million tax-exempt bond issued through the Polk County Industrial Development Authority and $28.5 million of new equity. The tax-free bonds were purchased by large institutional investors. The new equity came from Plenary Capital, an infrastructure investment fund based in Vancouver, B.C.