BHP sinks $7.7b into second stage of mega potash project
BHP will spend a further $US4.9 billion ($7.7 billion) to build stage two of the Jansen potash project in Canada, bringing the total investment for the project to $US15.1 billion.
BHP said the second round of investment will double production to approximately 8.5 million tonnes per year, transforming Jansen into one of the world’s largest potash mines.
BHP signalled last year it was looking to step up its massive Jansen potash project in Canada, hoping to seize the opportunity lying in the Russia-Ukraine war’s major disruption to world fertiliser supplies.
Sanctions have strangled the supply of potash – a key fertiliser for agricultural crops such as corn, soy, rice and wheat – from Russia and Belarus, which together account for about 40 per cent of global output.
BHP Jansen Potash Project in Canada AFR
First production from Jansen Stage 1, which cost US$5.7 billion, is expected to be delivered in late 2026. Construction of Jansen Stage 2 is anticipated to take approximately six years, and is expected to deliver first production in the 2029 financial year, followed by a ramp up period of three years.
Before making its big commitment to Jansen in August 2021, BHP had spent $US4.5 billion in assessing Jansen, 130 kilometres east of Saskatoon, Saskatchewan.
Potash is expected to add a counterweight to other key BHP commodities such as iron ore, copper and nickel because its demand and pricing did not move in sync with those products.
“The stage two investment advances BHP’s strategy to increase its exposure to commodities positively leveraged to the global megatrends of population growth, urbanisation, rising living standards and decarbonisation,” Mike Henry, chief executive officer of BHP, said.
Russia’s war on Ukraine has
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