BHP Group Limited has completed a detailed review of cost and schedule estimates for Stage 1 of the Jansen potash project (Jansen Stage 1) and confirms that the total investment 1 estimate for Jansen Stage 1 will increase to USD 8.4 billion (including contingencies) and the first production schedule has revert to the original schedule of mid CY2027. In July 2025, BHP confirmed that it expected to update the market on the timing and capital expenditure estimate for Jansen Stage 1 in second quarter of fiscal year 2026. The investment cost estimate has been updated from the previously estimated range of USD 7.0 billion to USD 7.4 billion (including contingentencies) announced in July 2025 and the USD 5.7 billion initial estimate of the investment cost for Jansen Stage 1 when the project was approved in August 2021.
As announced in July 2025, these cost increases have been driven by inflationary and real cost escalation pressures, design development and scope changes and lower productivity outcomes. The majority of the cost increase since the estimated range announced in July 2025 is from construction hours and quantities of materials that were not included in previous execution cost estimates. These construction costs were identified following the comprehensive review of Jansen Stage 1 budget and schedule.
BHP has implemented a response plan to address cost and schedule risks for Jansen Stage 1 which has improved productivity, strengthened project management and enhanced oversight of execution contracts. This plan is expected to support sustained efficiency gains in the delivery of Jansen Stage 1 and improved capital intensity in subsequent phases of the Jansen Project. Jansen Stage 1 continues to progress and is 75% complete.
BHP continues to expect Jansen Stage 1 to deliver approximately 4.15 million tonnes per annum (Mtpa) of production. At consensus prices, Jansen Stage 1 has an updated internal rate of return of 7.9% to 9.1% and an updated expected payback period of 11 to 15 years from first production2. Underlying EBITDA margins for Jansen Stage 1 remain strong at approximately 63% to 64% due to its low-cost position.
BHP is continuing to advance construction of Jansen Stage 2 and will implement the project execution improvements identified in the review of the investment cost and schedule estimates for Jansen Stage 1. BHP expects to update the market on the investment expenditure estimate for Jansen Stage 2 in fourth quarter of fiscal year 20 26. Longer term, Jansen has the potential for two additional expansions to reach an ultimate production capacity of 16 to 17 Mtpa (subject to studies and approvals).
