SASKATCHEWAN – Rumours surfaced last week that BHP Billiton has made an offer for Saskatoon-based Potash Corporation of Saskatchewan. Whatever the truth to the story, PotashCorp shares jumped 6.6% in Toronto on Thursday to $22.28 then closed at $21.
BHP Billiton made a $40-billion bid for PotashCorp in 2010, but the Canadian government blocked the deal.
PotashCorp operates five mines – Allan, Cory, Lanigan, Patience Lake, and Rocanville – in Saskatchewan and owns a suspended mine in New Brunswick. With production of more than 9.1 million tonnes of potassium chloride in 2015, PotashCorp is the world’s second largest producer.
Meanwhile, BHP Billiton is developing the Jansen potash deposit 140 km east of Saskatoon. Total costs over the life of the project could be $15 billion. The two shafts are to be completed this year and the surface infrastructure in 2017.
As is the case with most rumours, details such as what price might be offered are not available and some analysts doubt the story is true. Nonetheless, watch for breaking news if the rumour turns out to be accurate.