Latest news with #potash
Yahoo
4 days ago
- Business
- Yahoo
BHP faces $1.7bn blowout at Jansen project, production pushed to mid-2027
BHP Group has announced a delay and a potential cost overrun of up to $1.7bn (A$2.61bn) at its Jansen potash project in Canada. This comes as the miner reported 'record' copper and iron ore production for fiscal year 2025 (FY25). The Jansen project is crucial to BHP's strategy to diversify its portfolio, with more than a decade invested in its development. The Australia-based mining giant now expects the first stage of the Jansen project to cost between $7bn and $7.4bn, a substantial increase from the initial $5.7bn estimate. BHP attributes the rise to escalated costs, design and scope modifications, and lower than expected productivity. Additionally, the miner has delayed first production to mid-2027, a setback compared with the earlier target of 2026. It is also contemplating a two-year postponement for the second stage of the Jansen project, moving the target to FY31. This decision aligns with the expectation of additional potash supply entering the market in the medium term. In a statement, the company said: "Given potential for additional potash supply coming to the market in the medium term, and as part of our regular review of the sequencing of capital projects under the capital allocation framework, we are considering a two-year extension for the execution of Jansen Stage 2." Despite the challenges at Jansen, BHP highlighted its strong operational performance, with a 'record' copper output of more than two million tonnes (mt) in FY25. However, the company forecasts a decrease in production in FY26 to between 1.8mt and 2mt due to anticipated lower grades at the Escondida mine in Chile. Iron ore production also reached a new high, with BHP's Western Australia operations producing 290mt for the year. In another move, BHP revealed it is evaluating the potential sale of its Western Australia Nickel assets. These assets were placed into temporary suspension late last year amid oversupply in the global nickel market and a sharp plunge in forward consensus nickel prices. The company plans to review the suspension in February 2027. Meanwhile, last month, BHP announced it will collaborate with XCMG Mining Equipment to deliver fleet solutions across its operations worldwide. "BHP faces $1.7bn blowout at Jansen project, production pushed to mid-2027" was originally created and published by Mining Technology, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.
Times
18-07-2025
- Business
- Times
BHP pushes back potash mine opening after $1.7bn cost overrun
BHP has warned of a $1.7 billion cost overrun at its project to develop one of the world's biggest potash mines in Canada. The world's largest mining company said that its Jansen mine in Saskatchewan would now not start up until mid 2027, reverting its original schedule and ditching its plans to accelerate first production to the end of next year. BHP approved the first stage of the Jansen development in 2021, its first foray into potash, aiming to meet what it believes will be growing demand for the fertiliser ingredient as the world's population grows and arable land comes under pressure. • BHP boss warns Trump tariffs could be 'significant' hit to trade Mike Henry, BHP's chief executive, said that the first stage of Jansen was now estimated to cost between $7 billion and $7.4 billion, up from $5.7 billion originally. 'The estimated cost increase is driven by inflationary and real cost-escalation pressures, design development and scope changes, and our current assessment of lower productivity outcomes over the construction period,' BHP said, adding that Jansen stage one is now 68 per cent complete. The company approved a $4.9 billion investment in stage two of Jansen in 2023 but said it was now considering delaying first production from the second phase by two years to its financial year ending June 2031, citing the 'potential for additional potash supply coming to market in the medium term'. Analyst at Jefferies said that the '[capital expenditure] blowout at Jansen is the clear negative' and warned that 'the fundamental outlook for potash is very challenging'. The delays and cost overruns overshadowed an otherwise strong trading update including record iron ore and copper production ahead of BHP's annual results for the year to the end of June. The Australian miner was a FTSE 100 group until 2022 when it unified its dual company structure behind a primary listing in Australia, retaining only a secondary listing in London. It reported net profits of $7.9 billion in its last financial year, to June 2024 from commodities including iron ore, copper, steelmaking coal and nickel. Copper output rose 8 per cent year on year to top two million tonnes for the first time. Henry said it was 'a record level of production in a commodity critical to urbanisation, digitisation and electrification'. Iron ore output rose 1 per cent to a record 263 million tonnes. 'The efficiency of our infrastructure hubs continues to strengthen performance with rail, port and technology investments delivering tangible production outcomes,' Henry said. Shares in mining companies including BHP were hard hit by President Trump's tariff announcements in April on fears of weaker economic growth hitting commodity demand, but have since recovered their losses. Henry said that commodity demand so far this year had remained resilient, reflecting 'China's ongoing ability to grow its overall export base despite a significant decline in exports to the USA, and its ability to deliver robust domestic demand despite the dislocation in the property sector'. 'Copper and steel demand have benefited from a sharp acceleration in renewable energy investment, electricity grid build out, strong machinery exports and EV sales. While slower economic growth and a fragmenting trading system remain potential headwinds, stimulus efforts by China and the USA would help to mitigate the near-term impact,' he said.
CTV News
18-07-2025
- Business
- CTV News
BHP says costs at Jansen potash project up, first production pushed back to mid-2027
BHP has announced it will pour billions of dollars into a potash mine southeast of Saskatoon. SASKATOON — BHP Group Ltd. says the cost of the first phase of its Jansen potash project in Saskatchewan is going to be more expensive than earlier expectations. The miner now estimates the project cost will be in a range of US$7 billion to US$7.4 billion, up from an earlier estimate of US$5.7 billion. The company is also pushing back its estimate for first production from the mine to mid-2027 from earlier expectations for the end of 2026. BHP blamed the increased costs on inflationary pressures, design development and scope changes and lower-than-expected productivity. It estimates the first phase of the Jansen project is 68 per cent complete. The company also says given the potential for additional potash supply coming to market in the medium term, it's considering delaying first production from Jansen's second phase by two years to its 2031 financial year. This report by The Canadian Press was first published July 18, 2025.
Yahoo
18-07-2025
- Business
- Yahoo
BHP says costs at Jansen potash project up, first production pushed back to mid-2027
SASKATOON — BHP Group Ltd. says the cost of the first phase of its Jansen potash project in Saskatchewan is going to be more expensive than earlier expectations. The miner now estimates the project cost will be in a range of US$7 billion to US$7.4 billion, up from an earlier estimate of US$5.7 billion. The company is also pushing back its estimate for first production from the mine to mid-2027 from earlier expectations for the end of 2026. BHP blamed the increased costs on inflationary pressures, design development and scope changes and lower-than-expected productivity. It estimates the first phase of the Jansen project is 68 per cent complete. The company also says given the potential for additional potash supply coming to market in the medium term, it's considering delaying first production from Jansen's second phase by two years to its 2031 financial year. This report by The Canadian Press was first published July 18, 2025. The Canadian Press Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Reuters
18-07-2025
- Business
- Reuters
BHP delays Jansen potash project as costs surge; logs record copper output
July 18 (Reuters) - BHP Group ( opens new tab flagged delays and cost overruns of about 30% for its key Jansen Stage 1 potash project on Friday, even as the miner reported record annual copper production above 2 million metric tons and warned of a decline next year. The cost blowouts that could be up to $1.7 billion represents a significant setback for BHP, which had accelerated potash production following Russia's invasion of Ukraine, anticipating higher fertiliser prices due to supply disruptions from sanctioned Russian and Belarusian producers. The world's largest listed miner has spent more than a decade trying to break into the potash market as part of its diversification strategy. BHP attributed the cost blowouts to design and scope changes, inflationary pressures, and lower-than-expected productivity during construction. BHP said first production from its Jansen Stage 1 potash project in Canada has been pushed back to mid-2027 from the previously targeted end-2026, while capital expenditure estimates have surged to $7.0 billion-$7.4 billion from $5.7 billion. Adding to the project's challenges, BHP is considering delaying the second stage of Jansen by two years due to concerns about potential oversupply in the global potash market. "Given potential for additional potash supply coming to the market in the medium term, and as part of our regular review of the sequencing of capital projects under the capital allocation framework, we are considering a two-year extension for the execution of Jansen Stage 2," the company said in a statement. BHP committed $4.9 billion towards Jansen's second stage development in October 2023, with first production scheduled before June 2029. The company said it had spent only $400 million of the committed funds for the second phase. The miner reported copper production of 2.02 Mt for fiscal 2025, at the upper end of its forecast range. However, it said it expects output to drop to between 1.8 Mt and 2.0 Mt in fiscal 2026, reflecting planned lower grades at its flagship Escondida mine in Chile. Shares of the company rose 2.9% to A$40.26 by 0144 GMT, outperforming a 1.6% jump in the mining sub-index (.AXMM), opens new tab. BHP logged record annual iron ore production of 290 Mt, at the upper end of its guidance, while its fourth-quarter output of 77.5 Mt beat consensus estimates. BHP is also assessing a potential divestment of its Western Australia Nickel assets as part of a review, citing balance sheet impacts from the nickel business.
