Jansen potash project, Canada – update

Image of the Jansen potash mine

Photo by BHP

19th May 2023

By: Sheila Barradas

Creamer Media Research Coordinator & Senior Deputy Editor


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Name of the Project
Jansen potash project.

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.

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
The project is expected to cost up to $5.72-billion in its first phase. The project includes funding for the required port infrastructure.

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.

Planned Start/End Date
The Jansen shaft project was completed in the June 2022 quarter.

Jansen S1 was approved in August 2021 and BHP is targeting first production towards the end of 2026.

Latest Developments
BHP has reported that the proposed Jansen Stage 2 (S2) project is expected to come in at a lower cost than the S1 operation.

CEO Mike Henry has said that while studies for the S2 expansion are not yet complete, the company expects capital intensity for S2 of between $1 000/t to $1 200/t, which is lower than that of S1.

The miner announced in February that it would bring forward the Stage 2 studies at Jansen, which is scheduled to be completed during the 2024 financial year. This followed a previous decision to bring forward first production at Jansen S1 from 2027 to the end of 2026.

BHP hopes to make an investment decision on S2 in 2024. BHP has reported that all major permits are in place for S2, and that it has the necessary port capacity.

Should the company proceed, Stage 2 will add an additional four-million tonnes a year of potash capacity, with possible first production estimated to be in the 2029 financial year, during the time Jansen S1 will finish its ramp-up.

S1 ramp-up would start in 2026.

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 Creamer Media Reporter



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