Highfield Resources Muga Project: A €56.9M Step Towards Potash Production

The muriate of potash (MOP) market has faced supply disruptions and uncertainties in recent years, largely due to geopolitical tensions involving Russia and Belarus, two major potash producers. These disruptions have highlighted the need for diversified and reliable potash sources.

Highfield Resources’ Muga project in Spain is strategically significant in this context, as it is located in the heart of the European agricultural market, which currently relies heavily on imported potash. By developing a domestic source of MOP, the Muga project can help improve the security and stability of potash supply for European farmers, reducing their dependence on Russian and Belarusian imports.

Moreover, the project’s unique shallow mineralization and favorable location near existing infrastructure make it a potentially low-cost and efficient source of potash production.

Highfield CEO Ignacio Salazar commented: “We are pleased to be signing the last key contract for the construction of Muga. The civil works are the main component of the contract, and we are pleased to partner with Acciona with whom we have a long-standing relationship.

“With this contract, we are well prepared to start construction and build Muga to deliver a new and robust source of a critical fertilizer located strategically in the middle of the European market. Furthermore, the signing of this contract coincides with continued significant progress made in the negotiations with strategic investors to complete the remaining Muga funding.

“With the permitting in Spain sorted the project fully prepared to start construction and the debt financing in place, Highfield is fully focused on finalising the strategic process and getting Muga in construction.”

The company is in discussions with potential offtake customers, equity investors, business partners and royalty providers, and aims to conclude negotiations in the second quarter of 2024.

Muga is considered a strategically valuable project for Spain and the European Union, as it is located in a major agricultural region with a deficit in potash supply. The shallow mineralization and lack of aquifers above the deposit allow Muga to be built without costly shaft sinking. Quality infrastructure is already in place nearby to support the project.