PLANS for a potash mine with the potential to create 5,000 jobs have taken another step forward after the firm behind the scheme secured all the funding its needs to take the project to the preconstruction stage.

It emerged a year ago that York Potash, owned by international mining conglomerate Sirius Minerals, was examining the possibility of sinking a mine along the North Yorkshire coast.

Sirius has raised £55m on the Stock Exchange to take it through the work required ahead of its likely submission of a planning application this autumn.

The money raised will enable the firm to accelerate its current test drilling programme and develop detailed proposals for the mine, including its exact location.

York Potash founder Chris Fraser, who was appointed Sirius chief executive in 2010, said much of the money would be spent in the North Yorkshire economy.

He said: "This gives us the security of funds to conduct all the work we need to develop detailed proposals for how the mine could work, what the processes would be and where it could ultimately be located.

"We will continue to progress the proposals as quickly as possible and deliver the best possible proposals for the area.

"Much of the funding we have raised will end up in the North Yorkshire economy and people can be assured that we will continue to try to develop the proposals in the right way, with the least possible impact and the most possible benefits."

Sirius recently announced that detailed chemical analysis of potash found in the firm's first bore hole, close to Robin Hood's Bay, showed there to be more of the substance, and of better quality, than previously hoped.

There were also positive indications following the initial geological and visual inspection of potash extracted from a second site.

The new funding was sought after the positive results from those test drills led Sirius to review ways in which it could step up the development of its plans.

There is increased global demand for potash, an integral component of fertilisers used for food production.

If the project gets the go ahead, about 1,500 jobs would be created during the development and construction phase, with about 1,000 permanent jobs at the mine once it is up and running.

The firm believes the project has the potential to create up to 5,000 jobs when indirect jobs connected with the mine, such as support services, are taken into consideration.

If a mine does become operational, it should produce agricultural potash for at least 50 years.

Sirius, with operations in Australia and the US, bought York Potash, the site owner, in a £25m deal in January last year.

The site, stretching out into the North Sea, is adjacent to the UK's only existing potash mine, in Boulby, operated by Cleveland Potash, which started operations in 1973.

North Yorkshire has the UK's only viable, workable deposits of potash and it is believed there could be billions of tonnes of it on the site.