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BHP Jansen Potash Project Sees 30% Cost Surge, Production Delayed to Mid-2027

BHP is weighing a two-year deferral of stage two to its 2031 financial year in response to shifting potash supply projections.

It blamed the cost increase at its Jansen potash mine on “inflationary and real cost escalation pressures, design development and scope changes, and our current assessment of lower productivity outcomes over the construction period.”
BHP is expecting demand for potash, the fertiliser ingredient, to increase as the world’s population grows
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Overview

  • BHP has increased the phase one budget for its Saskatchewan Jansen potash project to US$7.0–7.4 billion, reflecting a roughly 30 percent rise over the original US$5.7 billion estimate.
  • The miner has pushed first production back to mid-2027 from end-2026 following cost pressures.
  • It attributes the overruns to inflationary escalation, design scope changes and lower-than-expected construction productivity.
  • Phase one is now 68 percent complete after US$4.5 billion in spending, with US$400 million invested in the second phase to date.
  • BHP is evaluating a two-year deferral of the second phase to its 2031 financial year in response to anticipated medium-term potash supply growth.