BHP Billiton Ltd., the world’s biggest mining company, is reducing spending on a potash mine in the Canadian prairies by about one-third amid the decline in global commodity prices.
The Australian company is allocating less than $200 million in capital expenditure in the current financial year to develop and study the feasibility of the Jansen project, down from $330 million in the previous 12 months, said Giles Hellyer, president of BHP’s Canadian unit.
“We’re doing more with less,” Hellyer said in a March 4 telephone interview from Saskatoon, Saskatchewan. “The intent is to be a lot more effective and efficient in what we’re doing and complete the work over a slightly longer time horizon.”
BHP has so far approve$3.75 billion to a feasibility study and initial construction work on the project, which has yet to get a final go-ahead from the company.
Construction crews at the site are excavating and lining two mine shafts, which may be complete in the next two to three years. Commercial production won’t start before 2020.
Potash prices have tumbled amid increased production. Farmers are spending less on fertilizer amid bumper crops and lower agricultural commodity prices.
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