Mardie salt and potash project, Australia – update

23rd June 2023 By: Sheila Barradas - Creamer Media Research Coordinator & Senior Deputy Editor

Mardie salt and potash project, Australia – update

Photo by: BCI Minerals

Name of the Project
Mardie salt and potash project.

On the Pilbara coast of Western Australia.

Project Owner/s
Potash developer BCI Minerals.

Project Description
An optimisation study has delivered a bigger project and an improved layout, compared with the July 2020 definitive feasibility study (DFS).

An expansion of the evaporation area has resulted in an increase of about 20% in salt production, from 4.4-million tonnes a year in the DFS to 5.35-million tonnes a year in the optimisation study, as well as an increase in sulphate of potash (SoP) production, from 120 000 t/y to 140 000 t/y.

Mardie will, ultimately, include a 100 km2 evaporation pond and crystalliser system, two processing plants and a new export facility.

Using an inexhaustible seawater resource and a production process driven mainly by natural solar and wind energy, there is potential to optimise and expand the project beyond the currently planned production levels.

The project’s operating life is estimated at a minimum of 60 years.

Potential Job Creation
During construction, 490 jobs are expected to be created, while 2 200 jobs are expected to be created during operations.

Net Present Value/Internal Rate of Return
The results of BCI’s design and cost review completed in June 2023  have resulted in an improved net present value of A$2.6-billion, compared with the A$1.5-billion estimated at the time of the final investment decision.

Capital Expenditure
The results of BCI’s design and cost review completed in June 2023 has updated the cost estimate for Mardie to A$1.62-billion, with a base estimate of A$1.42-billion and a contingency of A$208-million.

Planned Start/End Date
Construction at Mardie started in February 2022.

The timing of the first salt on ship and first SoP on ship have been delayed, with first salt on ship now targeted for mid-2026 and SoP for mid-2027, instead of the initial target of the first quarter of 2024 and the first quarter of 2026 respectively.

Latest Developments
BCI Minerals has flagged a A$500-million cost blow-out at its Mardie potash project while also warning of delays to first production. This is significantly higher than the A$913-million cost previously estimated for the project.

The cost and design review identified cost pressures across several areas, one being the civil works, which has impacted on the cost of the ponds, roads, transfer stations, crystallisers and jetty pad.

The key driver of these costs have been from geotechnical conditions of borrow material, which have increased haul distances that impacted on the demand for diesel, labour, accommodation and flights, all of which are subject to market cost increases.

The salt plant, while improved in design, has increased in the quantity of steel required, and has suffered from the increased cost of underlying components, owing to supply logistics and labour shortages driven by Covid.

While significant work has been undertaken on the project scope to ensure that it is optimised and fit for purpose, the review process has retained the steady-state production level of 5.35-million tonnes a year for salt and 140 000 t/y for SoP.

Overall, construction progress is 22% complete, and to date A$551-million in contracts have been awarded.

The necessary approvals to finalise the construction of the project are also progressing.

BCI expects to provide further information on project finance and its equity-raising process in coming months.  It is considering equity raising at BCI and project levels.

Discussions with financiers are progressing and BCI is targeting final documentation by the third quarter of this year to fund all capital except for the SoP plant. Debt finance for the SoP plant is targeted for late 2024, on completion of further design and cost development. 

Key Contracts, Suppliers and Consultants
The DFS was managed by BCI, with support from GR Engineering Services (DFS lead engineer), additional support from Worley, CMW Geosciences, Preston Consulting, RPS, Roskill, Argus Consulting, Braemar ACM Shipbroking and KPMG, besides others; and Engenium (project management contractor).

Contact Details for Project Information
BCI Minerals, tel +61 8 6311 3400 or email