Questor share tip: Sirius Minerals now a hold A report with a preliminary recommendation was expected to be published last week, ahead of a planning meeting on July 29. However, two reports prepared by consultants AMEC for the NYMNPA will now result in more studies and reports as Sirius deals with the key points. The final decision has now been deferred and there is no new timescale for the announcement. The first AMEC study claimed that Sirius had overstated the need to locate the minehead within the borders of the national park. The company plans to screen off the minehead with trees and bury most of the equipment to minimise its impact. However, the report said it was "not possible for AMEC to conclude on the basis of the evidence currently available that access to the York Potash polyhalite resource cannot be made from outside the National Park." The second study essentially concluded that its authors did not see a market for the form of potash Sirius would produce. "In the conclusion, AMEC states that it does not believe there is a significant market for polyhalite and therefore stated economic benefits are unlikely to occur," Sirius said. This is followed with a view that, as polyhalite cannot be sold in sufficient volumes, the economic and employment benefits cannot be realised. However, the company argued that there were a number of omissions in the reports, in particular an "offtake agreement" it had signed with a Chinese group for 1m tonnes of its annual production. Sirius said in the same statement that it had received sales commitments for an additional 700,000 tonnes of polyhalite from South-East Asian and Latin American customers. These agreements go some way to addressing the concerns about the market for polyhalite. However, it is not likely that a decision will be made quickly. Should the NYMNPA fail to grant Sirius a permit, once the current crop of objections has been worked through, Sirius can appeal to the Secretary of State for Communities and Local Government, who has the power to overturn the decision, but this is likely to take about nine months. This means there is now a period of prolonged uncertainty and the share price could underperform. It is disappointing that, after months of discussions, all these matters are yet to be resolved. Ultimately, if approval is given, the shares will rally strongly. Then there is the question of funding for management to deal with but project approval will make it much easier to secure the financing. All of these setbacks have a cost in terms of the company's ultimate valuation and the prospect of revenues has moved farther off. Speculators may wish to buy for the racier part of their portfolio but the official rating is now hold.