BHP Group Ltd. is in discussions with the Saskatchewan government about possible tax breaks as it nears a construction decision on the giant Jansen potash mine, two sources familiar with the talks said.
Australia’s BHP has already sunk US$4-billion into building mine shafts at the site, 140 kilometres east of Saskatoon, and as much as US$5.7-billion is needed to bring Jansen into production. The company is expected to decide as early as next month whether it will proceed with Jansen.
The Globe and Mail and Bloomberg reported in May that BHP was negotiating with Saskatoon-based Nutrien Ltd. on a possible joint venture agreement for Jansen. But the Melbourne-based miner is now facing the prospect of going it alone on Jansen, as talks with Nutrien have fizzled without an agreement in place, one of the sources said.
The Globe is not identifying the sources, as they are not authorized to talk to the media because discussions are confidential. BHP and Nutrien declined to comment for this story.
While Saskatchewan has some of the world’s richest reserves of potash, it is also a high-cost jurisdiction compared with Russia and Belarus, the other two market leaders.
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