UPDATE 1-Russian potash mine accident pushes Uralkali shares to 4-year low

Wed Nov 19, 2014 11:24am EST
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* Uralkali suspends work at mine after water flows in

* Accident could hit supply, lift global potash prices

* Uralkali is key market player, part-owned by Putin ally (Adds details, effect on global supply, updates shares)

By Polina Devitt and Natalia Shurmina

MOSCOW/YEKATERINBURG, Russia, Nov 19 (Reuters) - Shares in Russia's Uralkali, the world's top potash producer, fell sharply for a second day on Wednesday after a mine accident that could reduce global supplies and push up prices of the crop nutrient worldwide.

Uralkali shares have fallen 28 percent since Tuesday when it suspended work at its Solikamsk-2 mine, which accounts for a fifth of the company's output and 3.5 percent of global capacity, following an inflow of water.

A sinkhole, stretching 30 by 40 metres (yards), found at an abandoned mine 3.5 km (2 miles) to the east, increased concern about the future of the mine because an inflow of water and the resulting sinkhole in 2006 forced another Uralkali operation to shut permanently.

Despite this, Chief Executive Dmitry Osipov said: "The accident is not catastrophic for the company's operations or people living in the area."

Uralkali will consider accelerating the commissioning of new mining capacity at two other blocks -- Ust-Yayvinsky and Polovodovsky -- which are also in the Perm region near the Ural mountains, Osipov said.   Continued...