Reports related to this article:
Project(s): View 2 related projects in PECWeb
Plant(s): View 2 related plants in PECWeb
Released August 19, 2021 | SUGAR LAND
en
Researched by Industrial Info Resources (Sugar Land, Texas)--One of the largest potash-mining projects in recent years has received the final financial green light.
On Wednesday, mining giant BHP Group Limited (NYSE:BHP) (Melbourne, Australia) said it approved $5.7 billion in capital expenditures for the Jansen Stage 1 potash project in Saskatchewan, Canada. Industrial Info has tracked the project since 2006.
The project is expected to produce about 4.35 million metric tons of potash per year, with potential for expansion. The project faced major delays last year due to market conditions and complications stemming from the COVID-19 pandemic.
While the current global potash market has excess supply, BHP is betting demand growth will absorb new production capacity as the decade progresses. Potash is mainly used for fertilizer. Construction is expected to take about six years, and first ore is targeted in 2027.
"We anticipate that demand growth will progressively absorb the excess capacity currently present in the industry, with opportunity for new supply expected by the late 2020s or early 2030s," BHP said in a press release. "That is broadly aligned with the expected timing of first production from Jansen."
Industrial Info is tracking $21.88 billion worth of active medium- and high-probability potash-mining projects across the globe. Medium-probability projects are assessed as having a 70%-to-80% chance of moving forward as planned. High-probability projects have an 81%-to-99% chance.
Click on the image at right for a chart ranking the top 10 countries for medium- and high-probability potash-mining projects, by value.
Jansen Stage 1 includes design, engineering and construction of an underground potash mine and surface infrastructure, including a processing facility, a product storage building and a continuous automated rail-loading system, BHP said.
The potash will be shipped to export markets through Westshore, in Delta, British Columbia. The project includes funding for port infrastructure, BHP added. BHP had tentative plans to ship potash from three ports, but recently finalized Westshore as its sole choice.
BHP said it already has invested $4.5 billion in the project, including the construction of two shafts and associated infrastructure. Tuesday's announcement brings the amount earmarked for the project to more than $10 billion. Subscribers to Industrial Info's Global Market Intelligence (GMI) Metals & Minerals Project Database can click here for the project report.
The project is part of BHP's efforts to shed much of its fossil-fuels business. BHP said this week it plans to sell its oil and gas operations to Woodside Petroleum Limited (Perth, Australia) in a merger. The deal is valued at about $13 billion. BHP shareholders would be paid in Woodside stock. In 2019, BHP sold its U.S. shale assets for $10 billion.
BHP Chief Executive Officer Mike Henry said the Jansen project is "an important milestone for BHP and an investment in a new commodity that we believe will create value for shareholders for generations."
The Saskatchewan government said the decision to fund the Jansen project marks the single largest economic investment to be made in the province. With more than 1 billion metric tons in potash reserves, Canada says it is the world's largest producer and exporter of potash.
In a statement to Reuters, Nutrien Limited (NYSE:NTR) (Saskatoon, Saskatchewan), which touts itself as the world's largest potash producer with more than 20 million metric tons of potash capacity at six mines in Saskatchewan, appeared to shrug off BHP's Jansen announcement. It will take another decade for Jansen to have significant production, Nutrien said in the statement. For related information, see August 11, 2021, article - Nutrien Rides Wave of Fertilizer Demand as Market Tightens, Outlook Brightens.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn.
On Wednesday, mining giant BHP Group Limited (NYSE:BHP) (Melbourne, Australia) said it approved $5.7 billion in capital expenditures for the Jansen Stage 1 potash project in Saskatchewan, Canada. Industrial Info has tracked the project since 2006.
The project is expected to produce about 4.35 million metric tons of potash per year, with potential for expansion. The project faced major delays last year due to market conditions and complications stemming from the COVID-19 pandemic.
While the current global potash market has excess supply, BHP is betting demand growth will absorb new production capacity as the decade progresses. Potash is mainly used for fertilizer. Construction is expected to take about six years, and first ore is targeted in 2027.
"We anticipate that demand growth will progressively absorb the excess capacity currently present in the industry, with opportunity for new supply expected by the late 2020s or early 2030s," BHP said in a press release. "That is broadly aligned with the expected timing of first production from Jansen."
Industrial Info is tracking $21.88 billion worth of active medium- and high-probability potash-mining projects across the globe. Medium-probability projects are assessed as having a 70%-to-80% chance of moving forward as planned. High-probability projects have an 81%-to-99% chance.
Jansen Stage 1 includes design, engineering and construction of an underground potash mine and surface infrastructure, including a processing facility, a product storage building and a continuous automated rail-loading system, BHP said.
The potash will be shipped to export markets through Westshore, in Delta, British Columbia. The project includes funding for port infrastructure, BHP added. BHP had tentative plans to ship potash from three ports, but recently finalized Westshore as its sole choice.
BHP said it already has invested $4.5 billion in the project, including the construction of two shafts and associated infrastructure. Tuesday's announcement brings the amount earmarked for the project to more than $10 billion. Subscribers to Industrial Info's Global Market Intelligence (GMI) Metals & Minerals Project Database can click here for the project report.
The project is part of BHP's efforts to shed much of its fossil-fuels business. BHP said this week it plans to sell its oil and gas operations to Woodside Petroleum Limited (Perth, Australia) in a merger. The deal is valued at about $13 billion. BHP shareholders would be paid in Woodside stock. In 2019, BHP sold its U.S. shale assets for $10 billion.
BHP Chief Executive Officer Mike Henry said the Jansen project is "an important milestone for BHP and an investment in a new commodity that we believe will create value for shareholders for generations."
The Saskatchewan government said the decision to fund the Jansen project marks the single largest economic investment to be made in the province. With more than 1 billion metric tons in potash reserves, Canada says it is the world's largest producer and exporter of potash.
In a statement to Reuters, Nutrien Limited (NYSE:NTR) (Saskatoon, Saskatchewan), which touts itself as the world's largest potash producer with more than 20 million metric tons of potash capacity at six mines in Saskatchewan, appeared to shrug off BHP's Jansen announcement. It will take another decade for Jansen to have significant production, Nutrien said in the statement. For related information, see August 11, 2021, article - Nutrien Rides Wave of Fertilizer Demand as Market Tightens, Outlook Brightens.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn.
