THE Government has given a local mining company permission to build an energy plant in a move which could guarantee the future of more than 800 jobs.

Energy Minister Brian Wilson has given the Government's consent for Cleveland Potash Ltd to build a gas-fired combined heat and power (CHP) station at its Boulby works near Saltburn.

The construction of the multi-million pound plant will bring jobs to the engineering and construction industries and will secure the jobs of the 870 employees working at the mine.

Ashok Kumar, Labour MP for Middlesbrough South and Cleveland East, said: "I am very pleased to hear this news. This plant will safeguard jobs and lower energy costs at the mine, making it more competitive in the world market."

The mine, at Boulby in East Cleveland, produces about a million tonnes of potash and more than half-a-million tonnes of road salt and has annual sales of around £90m.

The mine is the UK's only potash mine and is the deepest in Europe.

Mr Kumar said: "It is a real summer bonus for the mine and for the workers there, as well as for local communities and the local environment. I understand it means the mine can now, with confidence, look to expansion with a key area of costs now guaranteed for them."

Gas fired power stations are economically efficient, and combined heat power stations are designed to produce both electricity and usable heat, and are considered to be environmentally beneficial.

Energy minister Brian Wilson said: "The decision demonstrates the Government's continuing commitment to promote CHP, wherever practicable, and our commitment to reducing emissions of carbon to fulfil the promises we gave at Kyoto."

In November last year, American Anglo sold its entire share capital in Cleveland Potash to Israel Chemicals' fertiliser division, ICL Fertilizers.

After merging with ICL, Cleveland Potash increased its production capacity to become one of the top five producers of potash in the world and the second largest in Europe.