Sirius Minerals plc Supply and distribution agreement with Muntajat (6578P)
11 Octubre 2019 - 6:29AM
UK Regulatory
TIDMSXX
RNS Number : 6578P
Sirius Minerals plc
11 October 2019
11 October 2019
Sirius Minerals Plc
Major supply and distribution agreement with Muntajat
-- Muntajat is a state-owned Qatari company which markets and
distributes approximately 9 million tonnes of fertilizer per
annum
-- Ten-year supply and distribution agreement with Muntajat into
Africa, Australia, New Zealand and certain Middle Eastern and Asian
territories
-- Contracted volumes increase to c.2.0 Mtpa in year five and
peak at 2.1 Mtpa in year eight - taking Sirius' aggregate peak
sales volumes to 13.8 Mtpa
Sirius Minerals Plc ("Sirius" or the "Company"), through its
subsidiary York Potash Ltd, has entered into an exclusive ten-year
supply and distribution agreement with Qatar Chemical and
Petrochemical Marketing and Distribution Company Q.P.J.S.C
("Muntajat"), for the sale and distribution of volumes of POLY4
into Africa (except Nigeria and Egypt), Australia, New Zealand and
certain remaining Middle-Eastern and Asian territories (the
"Agreement").
Chris Fraser Managing Director and CEO of Sirius, comments:
"We are delighted to expand our growing partnership with Qatar
through this long-term supply agreement with Muntajat. Qatar is
already a major investor in Sirius via QIA and Sirius is working
with Muntajat to explore the downstream combination of POLY4 with
nitrogen products in Qatar and/or the United Kingdom to create a
value-added multi-nutrient fertilizer. This new supply agreement
with Muntajat provides us with access to a number of new markets
for POLY4 and further underpins the large scale, international
market appetite for POLY4, lifting our aggregate peak sales volumes
to 13.8 Mtpa."
Abdulrahman Ali Al-Abdulla, Chief Executive Officer of Muntajat,
comments:
"We see tremendous potential in POLY4 and Sirius' Project which
will enable us to bring this multi-nutrient product to our
extensive global customer network. The addition of POLY4 will
complement our existing portfolio and will enable us to provide a
more complete solution to our customers in these important markets
by adding additional macro-nutrients to our portfolio."
Background to Muntajat
Muntajat is a state-owned Qatari company established in 2012
which markets, distributes and sells over 16 million tonnes per
annum ("Mtpa") of fertilizer, polymer, chemical and steel products
including approximately 9 Mtpa of fertilizer. Muntajat represents
and is exclusively responsible for the global sales and
distribution of products from 15 major industrial production
entities in Qatar and for marketing, selling and distributing all
of Qatar's fertilizer production. Muntajat has a global marketing
network servicing more than 3,000 customers in 135 countries from
Doha and 17 international locations.
Qatar is one of the largest urea producers in the world with a
14 per cent. share of world supply and produces approximately 5.6
Mtpa of urea as well as 3.8 Mtpa of ammonia and 2.3 Mtpa of
sulphur.
Supply Agreement
The Agreement provides for the exclusive distribution of POLY4
for a 10-year term that commences from commercial operations and
includes a five-year extension option. Minimum volumes relating to
the specific territories under the Agreement increase, in
aggregate, to approximately 2.0 Mtpa in year five and further to
2.1 Mtpa in year eight. The Agreement takes Sirius' aggregate peak
sales volumes to 13.8 Mtpa and peak contracted production in any
one year to 12.2 Mtpa, excluding options.
The Company may terminate Muntajat's distribution rights under
the Agreement in relation to a specific territory, if Muntajat
fails to distribute 75 per cent. of the contracted minimum volumes
for such territory over a three-year rolling period. In addition to
customary termination rights for both parties, Muntajat has the
right to terminate the Agreement in the event that Sirius does not
meet certain financing or operational milestones.
The pricing mechanism in the Agreement is linked to downstream
pricing received by Muntajat on the sale of POLY4 and incentivises
Muntajat to optimise the best FOB netback price for Sirius. Sirius
expects the Agreement to deliver pricing in line with its average
price expectations across the current supply agreement
portfolio.
Expanding partnership with Qatar
In addition to the Agreement, Sirius is working with Muntajat to
explore the downstream combination of POLY4 with nitrogen products
in Qatar and/or the United Kingdom to create a value-added
multi-nutrient fertilizer.
The Agreement expands the Company's existing relationship with
the state of Qatar, which, through the Qatar Investment Authority
("QIA"), is one of the largest investors in Sirius.
For further information, please contact:
Sirius Minerals Plc Jennifer Wyllie, Tristan Tel: +44 845
Investor Relations Pottas 524 0247
Email: ir@siriusminerals.com
-------------------- ----------------------------------- ---------------
Media enquiries Alex Simmons, Ed Brown Tel: +44 7970
Edelman Email: Siriusminerals@edelman.com 174 353
Tel: +44 7540
412 298
-------------------- ----------------------------------- ---------------
This announcement contains inside information as defined in
Article 7 of the Market Abuse Regulation No. 596/2014 and is
disclosed in accordance with the Company's obligations under
Article 17 of those Regulations. The person responsible for making
this announcement on behalf of the Company is Nick King (Company
Secretary).
About Sirius Minerals Plc
Sirius Minerals Plc is focused on bringing large scale volumes
of POLY4 to the global agriculture industry. POLY4 is the Company's
trademarked name for its unique multi-nutrient fertilizer to be
produced from the world's largest and highest grade polyhalite
deposit located in North Yorkshire, United Kingdom, which can be
used to increase balanced fertilization around the world. Sirius
Minerals' shares are traded on the Premium List of the London Stock
Exchange. Its shares are also traded in the United States on the
OTCQX through a sponsored ADR facility. Further information on the
Company can be found at: www.siriusminerals.com.
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END
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