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A carved out shaft deep in a potash mine is shown in this 2007 photo. (TROY FLEECE/THE CANADIAN PRESS)
A carved out shaft deep in a potash mine is shown in this 2007 photo. (TROY FLEECE/THE CANADIAN PRESS)

BHP earmarks $488-million for Jansen potash project Add to ...

BHP Billiton said Thursday that it has approved $488-million (U.S.) in spending to help develop its Jansen potash project in Saskatchewan.

The money will be used for site preparation and to buy long lead time items during the project's feasibility study.

BHP said the funding will also be used to start construction of production and service shafts should government approvals be received for the project.

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BHP tried and failed to buy Saskatoon-based PotashCorp last year after Ottawa stepped in and blocked the deal under provisions of the Investment Canada Act.

The takeover bid was also opposed by the Saskatchewan government, which argued that the former Crown corporation should remain in Canadian hands.

BHP's Jansen potash project was a key point of dispute during the takeover fight. PotashCorp had questioned BHP's commitment to develop the project if it were successful in acquiring the Canadian company.

In March, BHP signed a deal with SNC-Lavalin Group to help develop the mine.

The Montreal-based engineering and construction firm will initially complete a feasibility study for the first phase of the Jansen project, about 140 kilometres east of Saskatoon.

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