BHP gives long-awaited go ahead for Jansen potash mine in Saskatchewan

Australian mining giant BHP Group says it has approved $7.5 billion in capital spending to build its Jansen potash project in Saskatchewan.

The decision came as BHP announced a plan to merge its oil and gas operations with Woodside Petroleum Ltd. and reported its latest quarterly results.

The long-delayed project, located about 140 kilometres east of Saskatoon, is expected to produce about 4.35 million tonnes of potash per year with the potential for further expansions.

BHP also says it has signed a deal with Westshore Terminals in Delta, B.C., to handle the potash that will be shipped to export markets.

Construction of the mine is expected to take about six years, with first ore in 2027, followed by a ramp up period of two years.

Ahead of the decision, BHP had already spent billions on the Jansen project including the construction of two mine shafts that are nearly complete.