BHP Billiton today announced approval for US$240 million (BHP Billiton share 100%) of capital expenditure to support the development of the first stages of the Jansen Potash Project in Saskatchewan, Canada. This pre-approval expenditure will facilitate the early stage work for the establishment of the production and service shafts.
The Jansen project is being designed to produce approximately 8 million tonnes per annum of agricultural grade potash, and represents BHP Billiton's first production of potash.
The funding will be used to start the required ground freezing to allow safe and effective shaft sinking to take place, as well as completing detailed engineering, equipment and materials commitments and other elements that will allow the shaft sinking to begin once full environmental permits are in place, anticipated in mid-2011. The Jansen project is in the final stages of a pre-feasibility study and is expected to move to feasibility phase in mid-2010, with a full investment decision expected in late 2011.
BHP Billiton Diamonds & Specialty Products President Graham Kerr said: "The Jansen project is the first phase of what we expect to be our strong presence in the potash sector. In conjunction with the Jansen project, we will continue to pursue other potash opportunities that fit within our portfolio of tier 1, long-life, export-oriented assets," he said. In parallel with the Jansen project, BHP Billiton is also pursuing the Boulder and Young greenfield potash projects in Saskatchewan as well as advancing work on logistics and a port.
BHP Billiton holds approximately 7338 km2 under exploration lease in areas of the Saskatchewan potash basin which are considered to be the most promising for economically viable potash deposits.