Anglo American Plc on Feb. 24 reported development of its Woodsmith polyhalite mining project in northeast England continues to progress, confirming a capital expenditure of $530 million on the project last year, up from $292 million in 2020. The company put the project’s capital budget for 2022 at $0.6 billion.
By the end of 2021, excavation of the mineral transport tunnel had passed 18 km, beyond the intermediate access shaft site at Lockwood Beck. The Lockwood Beck shaft is complete, having reached its target depth of 383 meters, and shaft lining is currently underway. At the mine head itself, shaft boring has started in the services shaft, while progress is also being made on the production shaft infrastructure.
Anglo said the detailed technical review of the project, that began in mid-2020 to ensure the technical and commercial integrity of the full scope of its design, is now largely complete (GM Dec. 10, 2021).
The company said the review has confirmed that a number of elements of Woodsmith’s design would benefit from modification to bring it up to Anglo American’s safety and operating integrity standards and to optimize the value of the asset for the long term.
Ahead of the full project execution phase, the Woodsmith team, is working through the detailed design engineering throughout 2022 and is expected to make a number of changes to the phasing of work, particularly in relation to the two main shafts.
Anglo therefore expects the capital budget for the project for 2022 to be reduced by approximately $0.1 billion to $0.6 billion to accommodate these changes.
The company expects that the improvements it is making to the project will result in an enhanced configuration and therefore a different and longer construction schedule.
It has yet to indicate any projected timing for Woodsmith, or to indicate an initial production target. Last year, it said it was targeting [ultimate] production of up to 10 million mt/y of Poly4, the marketed form of polyhalite (GM Aug. 6, 2021), as per the targeted ultimate production under the project’s original developers, Sirius Minerals Plc.
Anglo bought Sirius in March 2020, paying £404.9 million (approximately $481 million at March 2020 exchange rates), or just 5.5 UK pence in cash per share (GM March 20, 2020).
The Woodsmith project is part of Anglo’s Crop Nutrients business. Last December, the company appointed Tom McCulley, who has led the development of Anglo’s Quellaveco copper project in Peru, as CEO of the Crop Nutrients business from Jan. 1, 2022, replacing Chris Fraser, who had been CEO of Sirius Minerals. Fraser now has taken up a strategic projects role for Anglo American.