Highfield Resources Ltd (ASX:HFR) recently completed the preliminary works for the construction of the Muga Mine in Aragón, Spain with zero accidents and zero environmental incidents.
The company is now ready to continue the construction works of the mine which aims to be a ‘zero residue mine’.
In this construction phase, more than 1,000 jobs will be created, and hundreds of opportunities will be generated for suppliers.
Europe’s own potash supply
This is an exciting time for Muga, not only because it is a long-term project that will boost the economy in this region, but also because Europe has been exposed to a situation of total dependence on foreign raw materials evidencing that Muga will be a strategic producer of European potash when it comes online.
Stakeholders ranging from local communities to Spanish and European institutions, perceive the Muga project as an opportunity to address this geopolitical and economic situation, further augmenting the reasons to support an already strong project.
Zero residue mine
Muga is also a strategic project in the international landscape, particularly as a European producer which aims to be a zero residue mine which will operate an optimised process in both water and energy consumption.
Highfield’s eighth sustainability report highlighted those key activities which are ensuring that sustainability is at the core of its business.
Community initiatives
This year Highfield will continue to build its relationship with the local communities.
In June 2022 the Government of Navarra launched the Muga community initiative which is a partnership between Highfield, governments and local communities to boost the socioeconomic potential of the company’s mining project in the region.
This initiative is a pioneer in social innovation and demonstrates the high level of interest afforded to the project from the surrounding communities.
This initiative has received great support from the government, which is acting as a coordinator whilst allocating funding for social projects that will help newcomers – which includes Highfield’s future employees – settle in this significantly depopulated region.
Financing strategy
2022 saw Highfield advancing its financing strategy which included a due diligence process with a comprehensive focus on the ESG theme.
The success in achieving all the financing milestones which resulted in a €320.6 million senior secured project financing demonstrates that Muga is a solid and robust project with a compelling value proposition.
Read: Highfield Resources lands A$25 million investment for shovel-ready Muga mine
The Ukraine war, now in its second year has raised the awareness of the strategic importance of raw materials and their security.
Europe depends on Russia and Belarus for 60% of its potash.
The European extractive industry plays a strategic role as a supplier and Europe is currently reviewing its legislation to enhance self-supply.
Highfield’s potash is therefore expected to be highly sought after.
As a project which is benefiting from positive long-term fundamentals as well as being in a safe region and close to premium markets, the company’s potash is expected to be in strong demand.
But more importantly, potash, as a fertiliser component, contributes positively to food security, an urgent priority matter raised by the UN in the Sustainable Agenda 2030.