POTASH: BHP Billiton to pour $2.6B into Jansen

SASKATCHEWAN – Despite uncertainty over the future price of potash, BHP Billiton has announced plans to go ahead with a US$2.6-billion investment in its Jansen potash project 140 km east of Saskatoon.

The money will be spent to complete the excavation and lining of the two underground shafts as well as the installation of essential surface infrastructure and utilities. The shafts are to be completed during 2016, the surface facilities in 2017.

BHP Billiton petroleum and potash president Tim Cutt said, "Our construction activities are going well and we have successfully introduced specialised boring machines that reduce the development timeframe and safety risk associated with construction of the shafts. This technology has been in operation for several months and we are very pleased with the results.”

The company is of the opinion that the longer term outlook for the potash price is strong, and Jansen will be one of the lowest cost producers. By completing the shafts now, production can be timed to meet growth in demand.

The total pre-production capital cost of the Jansen potash mine could be more than US$15 billion. With that in mind, BHP has said it may seek partners for the project in the future.

Please visit BHPBilliton.com to find more news about Jansen.