BHP sticks by potash mine

Cutt reportedly told the NewsCorp paper that the $19.2bn project was one of 2003-2007 chief executive Chip Goodyear’s better investments, even though it likely won’t produce potash until the 2020s.

“[The investment has been] one of the smarter strategic moves a company could have made,” Cutt was quoted as saying.

“We moved in at a time when acreage was available. The competition didn’t think third-parties would come in and amass that type of acreage.

“Saskatchewan is the one, big, large tier-one basin in the world.”

Potash refers to a mined or manufactured salt that contains potassium in water-soluble form. Deriving its name from ‘pot ash’, it is used in fertiliser and a number of other industrial products.

BHP’s simplified structure following the spin-off of South32 earlier this month features four ‘pillars’ of business, one of which is petroleum and potash.

The Saskatchewan basin holds 65% of the world’s potash resource, and BHP holds “a lot” of the undeveloped acreage in the region, Cutt reportedly told the paper.

“And we’re sitting there in a great position, because we’re building big shafts that will have up to 12mtpa of capacity, and we can build [Jansen] in phases.”

The mining giant has so far spent roughly US$4bn at Jansen.