BHP announces stage 2 $7.7bn investment in potash project

Australia’s biggest company is betting almost $24bn on a massive new project designed to keep a growing world fed and healthy.

Australia’s biggest miner has confirmed a further $7.7bn investment in a project designed to help feed the world’s booming population.

BHP will spend $23.8bn on its Jansen potash project in Saskatchewan, Canada, following the announcement of the project’s stage 2 investment this week.

The company has already allocated $16.1bn into two earlier stages of the mammoth mine, which could become one of the world’s largest sources of potash with an estimated 8.5 million tonnes per annum at full production.

Potash improves crop yields and nutritional health in food and is considered an essential ingredient in maintaining global food security.

Vertical shaft-boring machines at the Jansen project provide access to potash beds below the surface of Saskatchewan's prairie region. Picture: Supplied

BHP is positioning its commodity portfolio to capitalise on what it sees as the global mega trends of population growth, urbanisation, rising living standards and decarbonisation.

Chief executive Mike Henry said Jansen would make the company a leader in the global potash industry.

“This is an important milestone that underscores our confidence in potash and marks the next phase of the company’s growth in Canada,” he said.

“We believe Jansen will deliver long-term value for shareholders and the local community and will position BHP as one of the leaders in the global potash industry.”

Jansen stage 1 is 32 per cent complete and first production is expected to be delivered in late 2026.

Construction of Jansen stage 2 is expected to take six years, with the first production in 2029 and then a “ramp up” period of three years.

BHP chief executive Mike Henry says the project will deliver long-term value for shareholders. Picture: Supplied

Jansen stage 2 is expected to deliver about 4.36 Mtpa of production at $1650 per tonne.

The $7.7bn spend for Jansen stage 2 would develop additional mining districts, complete the second shaft hoist infrastructure to handle higher mining volumes, expand processing facilities and add more rail cars, the company said.

BHP will continue to ship potash from Westshore Terminals in Delta, British Columbia.

Company representatives gathered in Adelaide on Wednesday for the miner’s annual general meeting.

Shareholders will vote on the re-election of non-executive directors and the company’s remuneration report.

Originally published as BHP announces stage 2 $7.7bn investment in potash project