BHP (NYSE: BHP) raises Jansen Stage 1 capex to US$8.4B and eyes 4.15 Mtpa
Rhea-AI Filing Summary
BHP has revised the cost and schedule for its Jansen Stage 1 potash project, lifting the total investment estimate to US$8.4 billion (including contingencies) and pushing first production back to mid CY2027, in line with the original timetable. This compares with a prior estimated range of US$7.0–7.4 billion announced in July 2025 and the initial US$5.7 billion approval estimate in August 2021. The company attributes the latest increase mainly to additional construction hours and material quantities identified in a comprehensive budget and schedule review, alongside earlier inflation, design and scope changes, and lower productivity.
BHP reports Jansen Stage 1 is 75% complete and still expected to deliver about 4.15 Mtpa of potash. At consensus prices, the updated internal rate of return is 7.9%–9.1% with an expected payback of 11–15 years from first production, and underlying EBITDA margins are projected at roughly 63%–64%. The company has implemented a response plan to improve productivity, strengthen project management and enhance contract oversight, and it continues to advance Jansen Stage 2, with a planned update on Stage 2 investment estimates in Q4 FY2026.
Positive
- None.
Negative
- Total investment for Jansen Stage 1 rises to US$8.4 billion, above the prior US$7.0–7.4 billion estimate and the original US$5.7 billion approval cost, with payback now expected at 11–15 years from first production.
Insights
BHP faces higher Jansen Stage 1 capex and a longer payback, though projected margins remain strong.
BHP now expects total investment for Jansen Stage 1 to reach
Despite the higher spend, Jansen Stage 1 is reported as 75% complete, with expected output of about 4.15 Mtpa. At consensus prices, BHP cites an internal rate of return of
BHP indicates it has implemented a response plan to improve productivity, strengthen project management and enhance oversight of execution contracts, and intends to apply these lessons to Jansen Stage 2. The company continues to advance Stage 2 construction and plans to update the market on Stage 2 investment expenditure estimates in
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
20 January 2026
| BHP GROUP LIMITED (ABN 49 004 028 077) (Exact name of Registrant as specified in its charter)
VICTORIA, AUSTRALIA (Jurisdiction of incorporation or organisation)
171 COLLINS STREET, MELBOURNE, VICTORIA 3000 AUSTRALIA (Address of principal executive offices) |
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If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): n/a
Exchange release
20 January 2026
Update - Jansen Stage 1 Potash Project
BHP 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 investment1 estimate for Jansen Stage 1 will increase to US$8.4 billion (including contingencies) and the first production schedule has reverted 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 H2 FY2026. The investment cost estimate has been updated from the previously estimated range of US$7.0 billion to US$7.4 billion (including contingencies) announced in July 2025 and the US$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 position3.
BHP President Americas, Brandon Craig said
“Jansen is an important pillar in BHP’s long-term growth strategy and is a long-life, low cost expandable asset that is expected to generate benefits for shareholders for decades. Once operational, Jansen will establish BHP as a leading player in the global potash industry. We remain positive about the progress at Jansen and in potash as a future facing commodity with strong long-term demand fundamentals driven by population growth, better diets, rising living standards, and the need for more productive and sustainable use of arable land.”
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 Q4 FY2026.
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).
Authorised for lodgement by Stefanie Wilkinson, Group Company Secretary
BHP Group Limited ABN 49 004 028 077
Footnotes
| 1. | Investment expenditure includes: project capital expenditure, project operating expenditure, cost to construct right-of-use assets (i.e. Westshore port terminal and 3rd party rail line) and related contingencies. |
| 2. | Price assumptions reflect a range of Argus and CRU prices. Jansen Stage 1 internal rate of return range is post-tax, nominal and reflects Argus and CRU prices (Average 2029–2039: US$349/t Argus and US$256/t CRU, FOB Vancouver, Real 1 Jan 2026). The internal rate of return is the expected internal rate of return based on Jansen Stage 1’s cashflows across approximately 90-year mine life. |
| 3. | Jansen Stage 1 EBITDA margin reflects a range of Argus and CRU prices across approximately 90-year mine life. |
BHP Group Limited ABN 49 004 028 077
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| BHP Group Limited | ||||||
| Date: 20 January 2026 | By: | /s/ Stefanie Wilkinson | ||||
| Name: | Stefanie Wilkinson | |||||
| Title: | Group General Counsel and Group Company Secretary | |||||
FAQ
What cost changes did BHP announce for the Jansen Stage 1 potash project (BHP)?
BHP now estimates total investment for Jansen Stage 1 at US$8.4 billion including contingencies. This is higher than the US$7.0–7.4 billion range announced in July 2025 and the initial US$5.7 billion estimate when the project was approved in August 2021.
How has the Jansen Stage 1 production timeline changed for BHP?
The first production schedule for Jansen Stage 1 has reverted to BHP’s original plan of mid CY2027, following a detailed review of cost and schedule estimates.
What is the current completion status and expected output of Jansen Stage 1 for BHP?
BHP reports that Jansen Stage 1 is 75% complete and is expected to deliver approximately 4.15 million tonnes per annum (Mtpa) of potash once in operation.
What returns does BHP expect from Jansen Stage 1 at consensus potash prices?
At consensus prices, BHP cites an updated internal rate of return of 7.9%–9.1% for Jansen Stage 1, with an expected payback period of 11–15 years from first production and underlying EBITDA margins of about 63%–64%.
How is BHP responding to cost and schedule risks at Jansen Stage 1?
BHP has implemented a response plan for Jansen Stage 1 that focuses on improving productivity, strengthening project management and enhancing oversight of execution contracts, aiming to support sustained efficiency gains and better capital intensity in this and later phases.
What are BHP’s plans for Jansen Stage 2 and potential future expansions?
BHP is continuing to advance construction of Jansen Stage 2 and plans to update the market on Stage 2 investment expenditure estimates in Q4 FY2026. Longer term, Jansen has potential for two additional expansions to reach an ultimate capacity of 16–17 Mtpa, subject to studies and approvals.
