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Jansen potash project, Canada

Image of Jansen potash mine headgear

Photo by BHP

19th January 2024

By: Sheila Barradas

Creamer Media Research Coordinator & Senior Deputy Editor

     

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Name of the Project
Jansen potash project.

Location
About 140 km east of Saskatoon, in Saskatchewan, Canada.

Project Owner/s
Multinational mining company BHP.

Project Description
The Jansen potash project has an estimated measured resource of 5.17-billion tonnes and an inferred resource of 1.27-billion, both grading 25.7% potassium oxide, 7.1% insolubles and 0.07% magnesium oxide.

Jansen Stage 1 (S1) will produce about 4.35-million tonnes a year, and has a basin position with the potential for further expansions, subject to studies and approvals.

Jansen S1 includes the design, engineering and construction of an underground potash mine and surface infrastructure, including a processing facility, product storage building and continuous automated rail loading system. Jansen S1 product will be shipped to export markets through Westshore, in Delta, British Columbia.

The Jansen S1 project will convert about 20% of the 5.23-billion tonnes in measured and indicated mineral resources into ore reserves. Jansen S1 is expected to produce 4.35-million tonnes a year of potash.

The project is expected to operate for about 100 years. It includes a separate scope of work for the excavation and lining of the production and service shafts, while the installation of essential surface infrastructure and utilities will continue.

BHP approved Jansen Stage 2 (S2) of the project in November 2023, and will transform Jansen into one of the world’s biggest potash mines, doubling production capacity to an estimated 8.5-million tonnes a year.

S2 is expected to deliver about 4.36-million tonnes a year of production at a capital intensity of about $1 050/t, lower than S1, owing to the leveraging of existing and planned infrastructure. The project will include the development of additional mining districts, completion of the second shaft hoist infrastructure to handle higher mining volumes, expansion of processing facilities and the addition of more rail cars.

Potential Job Creation
Jansen will create at least 3 500 jobs during peak construction and 600 in operation. The project will have a gender-balanced workforce and about 20% of employees will be local First Nations members.

Net Present Value/Internal rate of Return
The investment decision will generate an internal rate of return of 12% to 14% and have an expected payback period of seven years from first production.

Capital Expenditure
S1 is expected to cost up to $5.72-billion in its first phase. The project includes funding for the required port infrastructure. BHP reported in November 2023 that it would not be initiating a formal capacity extension for the Westshore port terminal yet and would evaluate the extension closer to S2’s reaching first production.

The excavation and lining of the production and service shafts, as well as the installation of essential surface infrastructure and utilities, are estimated to cost $2.97-billion.

S2 is estimated at $4.9-billion.

Planned Start/End Date
The Jansen shaft project was completed in the June 2022 quarter. S1 was approved in August 2021 and BHP is targeting first production towards the end of 2026.

Construction of Jansen S2 is expected to take about six years and deliver first production in the 2029 financial year, followed by a ramp-up period of three years.

Latest Developments
Jansen S1 was 32% complete and progressing in line with its schedule as at November 2023.

Key Contracts, Suppliers and Consultants
DMC Mining Services (development of two new mine shafts); SNC-Lavalin (feasibility study for Jansen S1, as well as engineering, procurement and construction management services for S1); and Cementation Americas (post-liner excavation and steel and equipping); Wicehtowak Frontec Services, a joint venture partnership between ATCO Frontec and George Gordon Developments (camp support services at BHP’s Jansen Discovery Lodge); 2Nations Bird, a partnership between Bird Construction, Beardy & Okemasis Cree Nation's Willow Cree Developments General Partner, and Fishing Lake First Nation's Development Corporation, FLFN Ventures (works on the Jansen Stage 1 and site services); KDM Constructors comprising the Kawakatoose, Day Star and Muskowekwan Nations, along with the Saskatchewan-based SECON Group of Companies (subcontractor to 2Nations Bird); and George Gordon Developments (subcontractor for the site services agreement).

Contact Details for Project Information
BHP, tel +61 3 9609 3333.

Edited by Martin Zhuwakinyu
Creamer Media Senior Deputy Editor

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