6-month Production Delay for Legacy Potash Mine

  • 12 Aug 2016
  • The StarPhoenix

Legacy faces six-month setback in production of potash: K+S AG

An industrial accident at K+S Potash Canada’s Legacy project has delayed the solution mine’s first commercial production until the second quarter of 2017, from the end of 2016 as originally scheduled, according to its parent company.

“Regardless of this, K+S is still assuming that it will be able to reach its target production capacity of 2 million tonnes at the end of 2017,” K+S AG said in its second quarter report on Thursday.

The German company’s announcement comes almost a month after the structure supporting a 28-metre-tall crystallizer collapsed during a test, sending the mammoth vessel plummeting to the floor of the $4.1 billion mine’s main production facility.

No one was injured, but the accident caused “consequential damage” to the mine’s facilities, K+S Potash Canada said after the accident. On Thursday, a spokeswoman confirmed that the accident was the only cause of the delay.

“It could have been a lot worse,” a pipefitter who worked on the project near Bethune before being fired after posting about the incident on social media told the Saskatoon StarPhoenix at the time, noting that everyone in the vicinity was lucky to be alive.

It remains unclear what caused the collapse. The company spokeswoman said in an email the investigation is “a complex legal procedure with a handful of parties involved,” and that the company will not publicly discuss it.

The province’s 10th potash mine, which will have a total production capacity of 2.86 million tonnes per year, is still expected to reach its target goal by the end of 2017, K+S said in its report.

On Thursday, the German firm reported second quarter operating earnings of 15 million euros, the equivalent of $21.8 million, on revenues of 732.2 million euros.

That represents a nearly 92-percent decline from the 179.2 million euros K+S earned on revenues totalling 914.4 million euros in the same quarter last year.

In a statement, K+S chairman Norbert Steiner attributed the decline to several factors, including a “difficult market environment in the potash business.”

About prosperitysaskatchewan

Consultant on Saskatchewan's natural resources.

Posted on August 12, 2016, in economic impact, potash. Bookmark the permalink. Leave a comment.

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