BHP Ltd., Melbourne, this week said its Jansen Stage 1 potash project in Saskatchewan remains on track for “a go or no-go decision” in the next two months. Under current plans, BHP’s Stage 1, should it go ahead, would provide 4.3-4.5 million mt/y of potassium chloride production capacity.
In its Operational Review for the year ended June 30, 2021, the mining major reported its current investment program to complete the shafts at Jansen is now 93 percent complete, up from 91 percent at the end of March (GM April 23, p. 1).
BHP told analysts and investors at the Potash Outlook investor and analyst presentation and briefing in June that it wants to have a port solution locked in before it takes the final investment decision for Jansen Stage 1 to its board for approval (GM June 18, p. 1).
As previously reported, the group is considering two options regarding a port. One is a commercial option in the port of Vancouver at an existing facility. The other is a greenfield option at the port, which would see BHP joining the development of the proposed West Coast Terminal expansion.
Late on July 22, Westshore Terminals Investment Corp., Vancouver, said its wholly-owned subsidiary, Westshore Terminals LP, has executed an agreement with BHP Canada Inc., a subsidiary of BHP Group, to provide port services to BHP’s proposed Jansen Potash Mine in Saskatchewan. The agreement is subject to approval by the Board of BHP and execution by BHP, after which the agreement would still be conditional on BHP making a final investment decision on Stage 1 of the Jansen Project.
If the Jansen Project does proceed, the agreement requires Westshore to handle potash for BHP for a term to 2051, subject to extension. It also requires Westshore to construct the necessary infrastructure to handle potash at Westshore’s Roberts Bank Terminal by 2026, with BHP funding the construction. If BHP announces a final decision to proceed with the Jansen Stage 1 Project, the BHP-Westshore agreement will become binding on BHP, at which time Westshore will provide further details concerning the agreement.
In other late-breaking BHP news, the Globe and Mail reported July 23 that BHP is pressing the province of Saskatchewan for tax concessions leading up to its final Jansen decision.
BHP in June gave what analysts believed was the mining group’s strongest indication to date that it intends to go ahead with the Jansen potash project. In the 56-page Potash Outlook investor and analyst presentation and briefing on June 17, BHP laid out the pro-case for the potash project, and for the mining group to a become a major new global supplier of the nutrient (GM May 21, p. 1).
RBC Director Australian Metals & Mining Equity Analyst Kaan Peker sees BHP likely giving the Jansen Stage 1 project the green-light in August, according to a Bloomberg report at that time, citing a note by Peker (GM July 2, p. 1).
RBC also sees the mining group as likely developing all four proposed stages of Jansen, producing 16-17 million mt/y at full capacity by 2035, for a total capex of $22 billion.