Experts unlikely to recommend either way on Sirius potash project

The mining company trying to construct Britain's largest mine in the North York Moors national park has been told planning experts are unlikely to recommend whether it should go ahead or not.

Sirius Minerals wants to mine polyhalite, a type of potash fertiliser, with construction of parts of the mine planned for the park - a landscape where no such development is normally allowed.

The news sent shares in Sirius up 7 per cent to their highest level in more than a year as several analysts said the indication from the North York Moors National Park Authority could be helpful to the company's plans.

"Neutral feels positive," said analysts at Liberum, one of the brokers to the Aim-listed company.

The authority's planning committee is due to decide at a two-day meeting starting on June 30 whether Sirius should be allowed to proceed. The company has been developing its plans for four years.

The planning committee would normally expect to be guided by a recommendation from park officials. But Sirius said on Thursday the report was "likely to include an 'open recommendation' for the authority's members to consider".

If construction were permitted it would in effect acknowledge that the mine proposal had exceptional aspects which placed the development in the interest of the public. Sirius says it would generate more than £1bn of annual exports and 4,000 direct and indirect jobs.

Liberum said the announcement could be "a material breakthrough in its permitting process", because many of the planning committee's members represent other local authorities that support the Sirius plans.

"It seems much easier to construct a scenario where approval is granted than the other way," the equity research team said.

Paul Smith, of broker WH Ireland, said the park's decision seemed to be "a positive outcome for the permitting process".

"After several months of additional time to review the full documentation supplied by Sirius and the additional information requested, the planning officers can find no reason to recommend a rejection of Sirius's proposal," Mr Smith wrote in a note.

Macquarie, the company's other broker, said a planners' recommendation to reject the project would have made it more likely the committee would have done so. "The probability of this outcome has now fallen significantly," it said.

Chris Fraser, Sirius's chief executive, said the company was pleased to be heading towards a decision by the members. "We have confidence in the strength of our planning case, the huge levels of support for the application and the many wide-ranging economic benefits that the project will deliver to the local area and to the country at large," he said.

Shares in the company are likely to be suspended on June 30 while the committee makes its decision.

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