Polyhalite is a naturally occurring mineral containing four of the six nutrients key to plant growth – potassium, sulphur, magnesium and calcium – and is sold on as fertiliser, with China recognised as a burgeoning marketplace.
Hancock has paid $250m for a royalty stream on production from the project and $50m worth of shares in Sirius.
Under the terms of the agreement, Hancock British Holdings is acquiring a 5% royalty on the first 13m tonnes of fertiliser produced every year and 1% on anything over that output figure at a cost of US$250m.
The deal is subject to a number of conditions, the main one being Sirius must secure Stage-One funding for the mine, sited near Scarborough in Yorkshire, which is put at just over US$1.1bn.
Chris Fraser, managing director and CEO of Sirius, commented: "We are delighted to have signed this agreement with such an experienced party in the mining industry, as well as one that has very successful and strong leadership and a long term and growing agricultural interest."
Hancock, which is also in a joint $278 million bid with China's Shanghai CRED Real Estate for Australia's biggest cattle empire, S. Kidman & Co, said Sirius could become one of the world’s leading producers of multi-nutrient fertiliser and could have a life of 100 years.
"This fits with my approach of investing in strategic areas for the long term, and I hope the product is of assistance to many Australian farmers," Rinehart said in a statement.