LONDON (Reuters) – British politicians are calling on Anglo American (JO:) to reconsider halting work on the Woodsmith fertilizer project in northern England, part of an asset overhaul Anglo announced after rejecting takeover proposals from the global miner BHP Group (NYSE:).
Anglo’s Crop Nutrients unit held a town hall meeting on Thursday to advise on the delay to the North Yorkshire project, two sources said. According to the mining company’s website, Woodsmith currently employs about 2,000 people, including contractors.
“We urge (Anglo) to pause and think carefully about the catastrophic impact that the loss of so many high-quality jobs could have on our field,” said Roberto Weeden-Sanz, the Conservative Party candidate for Scarborough and Whitby.
“The local population has been supporting this fantastic project for many years and it should not be used as a sacrificial lamb to fend off a takeover by a larger company,” he added.
Anglo says on its website that Woodsmith has generated £1.5 billion ($1.91 billion) for the economy of Yorkshire and the North East of England since construction started in 2017.
“We are slowing down the development of the project while we strengthen our balance sheet, even as we continue to invest,” Anglo said in an emailed comment. “Once conditions are right, we will move forward again and realize Woodsmith’s potential as a multi-generational mine.”
“Unfortunately, we expect that jobs will be affected and we will work through that and consult with our employees to provide as much clarity as possible as soon as possible,” it added, without giving details of the figures.
Anglo has been looking for partners for Woodsmith for about six months, CEO Duncan Wanblad told Reuters on May 16, reiterating that the company will be one of three pillars of the revamped miner even as it slowed its development and pushed it the first production will return from 2027. .
The decision to abandon the project is part of a radical plan announced earlier this month to divest or sell assets following a 94% drop in annual profits.
“Anglo must not make rash decisions that jeopardize the livelihoods of hard-working and highly educated Teessiders,” said Tees Valley Mayor Ben Houchen. “We want to hear directly from Anglo and for them to work with the government to ensure every option is considered before drastic action is taken.”
Woodsmith, on which Anglo announced a $1.7 billion writedown a year ago, has the world’s largest known deposit of polyhalite, a naturally occurring mineral containing nutrients including potassium, calcium, magnesium and sulphur, which it markets as POLY4.
A feasibility study for the project is not expected to be completed until early 2025. This would have been followed by a full call from the board to continue in the first half of the year if the restructuring of the wider assets had not prevented this.
Analysts estimate total spending on Woodsmith at about $9 billion. Anglo said it has invested around £3 billion in it to date.
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