Fresh jobs blow as potash mine announces that 700 workers are facing the axe.
UP to 700 jobs will be axed at Boulby potash mine in another "hammer blow" to Teesside industry.
A total of 360 workers, including 220 staff and 140 contractors, will lose their jobs, staff have been told by mine owner ICL UK.
A similar number are expected to go in 2018 when potash reserves run out.
It's the latest grim jobs news to hit Teesside within weeks, in the wake of the Redcar steelworks closure.
On the same day it was also confirmed 700 jobs were to go with the closure of three tax offices on Teesside.
ICL Fertilizers - formerly Cleveland Potash - is one of Teesside's largest employers; most of its 1,100 workers live within a 12-mile radius of Boulby mine, which is the second deepest in Europe.
The firm says levels of "economically-feasible" potash reserves at Boulby will run out by 2018 - and the site needs to switch to producing fertiliser polysulphate.
It will "restructure its cost base" to "remain economically viable while the transition occurs."
Peter Smith, ICL executive vice-president, said the "painful" move was vital to secure the future of the business.
Mr Smith said: "The reality of our potash reserves running out by 2018 means that we must develop a new business strategy if we are to continue mining at Boulby. "That strategy is based on moving our focus to polysulphate production. Mr Smith confirmed that a similar number of jobs could go in 2018. He said: "There is a viable future here for Boulby potash mine - that future is built around polysulphate.
"We need to make sure we achieve financial viability. Today we announced a reduction of 360 people here, which is unfortunately essential.
"When the potash runs out in 2018 we will be required to reduce the numbers again to meet the needs of the polysulphate business. I can't be definitive about what exactly that looks like, but something similar to today."
Mr Smith said the job losses would cover a "cross section of the workforce".
Following a consultation with staff and unions he said it was expected that Cleveland Potash staff "will be leaving some time in February/ March", and contractors gradually, dependent on their contracts.
Sirius Minerals, behind the York Potash Project under development down the coast at Whitby, could offer prospects for laid-off Boulby staff in the future when it is operational.
Asked if he would work with York Potash to help his staff find jobs, Mr Smith said if York Potash was employing at the time of the future job cuts in 2018 "I will be the first person to ask them to employ our people."
The Whitby mine will also be extracting the same mineral and has claimed it "will extract between 10 and 20 times the volume of polyhalite that ICL UK now proposes."
But Peter Smith was confi-dent Boulby currently had the market advantage.
He said: "We will invest PS20m this year in the site infrastructure, with a potential investment of a further PS20m that would enable us to expand production [five-fold] to 1m tonnes by 2020."
There is also "long-term potential for up to three million tonnes", he added, meanwhile the firm is also carrying out a feasibility study into building a new PS40m granulation plant.
He added: "This is the road we believe can secure for the future of Boulby. Once the move to polyhalite production occurs, ICL UK will remain a signifi-cant employer, but it is unlikely to be at the same level as in the past."
Potash has been mined at Boulby since the early 1970s.
ICI begin work on a mine in 1969 and started producing potash in 1973.
The mine has been capable of producing up to one million tonnes of potash a year and is the second deepest mine of any kind in Europe.
Potash is an agricultural fertiliser and the mine produces about half of the UK's output. Rock-salt, produced as a by-product, is used as a de-icer on local roads.
Cleveland Potash was formed as a joint venture between ICI and mining giant Anglo American.
The business was sold to Israel Chemicals in 2002.
It was renamed from Cleveland Potash to ICL UK in September to reflect its parent firm's ownership.
The firm reported losses of PS190m for 2013 after a slump in potash prices forced it to slash the value of one of subsidiaries.
An operator uses a remotely controlled rock cutting machine to mine for potash at the Boulby Potash mine which began production |in 1973. At a depth of 1400 metres it is the second deepest mine in Europe and extends out 7km under the North Sea IAN FORSYTH
ICL Potash Mine, Boulby, above, and Peter |Smith, executive vice president PETER REIMANN