Sydney, June 20, 2026, 02:05 (AEST)
- BHP finished Friday at A$61.40, sliding 5.6% on the day. For the week, shares dropped around 2.4%.
- BHP pushed the Jansen Stage 2 cost estimate up to US$6.9 billion, up from US$4.9 billion before. The company is set for a US$2.3 billion impairment on the project. BHP kept its capital spending guidance for financial 2027 close to US$11 billion.
- BHP and union leaders are set to sit down Tuesday about potential strikes at Port Hedland iron-ore. Investors are watching as this adds a second near-term risk.
BHP Group’s shares on the ASX slumped 5.6% to A$61.40 Friday. The miner reported another cost revision for its Jansen potash project in Canada. That was the steepest one-day drop since April 7, 2025.
The overrun at Jansen comes less than two weeks before Brandon Craig is set to replace Mike Henry as BHP’s chief executive on July 1. Jansen is at the center of BHP’s shift towards potash and copper as it looks to lessen its dependence on iron ore and coal. The timing means this is more than just a hit for one session.
BHP underperformed a weak market Tuesday. The S&P/ASX 200 slid 0.9% to 8,828.70, with mining stocks off about 4%. Rio Tinto dropped 3.1%, Fortescue shed 1.1%. The wider gap for BHP suggests investors are reacting to a capital-allocation issue specific to the company, piling on pressure in a mining-led selloff.
BHP said it now expects the Stage 2 cost will be US$2 billion higher, blaming extra construction time and materials. First output is now set for late financial 2031. By the end of May, the project was 16% done, with engineering at 83%. The miner kept its group capex outlook for financial 2027 at about US$11 billion.
An impairment means a company cuts the value of an asset on its books, but doesn’t pay cash right away. Shareholders now face a bigger problem—cost overruns. The Stage 1 estimate jumped to US$8.4 billion, up from the US$5.7 billion approved in 2021.
BHP is sticking with its forecast of an 11% internal rate of return and an eight-year payback for Jansen, its potash project. With both phases running, Jansen would provide about 10% of the global potash market. These numbers keep the investment case in place, but do nothing for the project’s shaky budget credibility.
BHP’s estimates aren’t being rejected, but investors want construction risk on potash lower before buying in, William Taylor, COO and portfolio manager at ETF Shares, said Friday. “The market is reacting sharply to the immediate capital intensity,” Taylor said. Price moves Friday signal investors are discounting BHP’s numbers for now. Investing.com Canada
Craig is sticking with the plan. “Jansen is an important pillar of BHP’s strategy,” the CEO-elect said. He called the project a low-cost asset expected to run almost 60 years. His first real test is clear—keep resets to a minimum and show that Stage 1 can start production by mid-2027. Moneyweb
The risk isn’t just in Canada. BHP faces possible stoppages at its Port Hedland operations, with unions able to strike after proper notice. Another group of workers is also seeking strike authorization. Any disruption could hit the export chain for BHP’s main iron ore business, but the company says it has contingency plans.
BHP watchers are set to focus on the Port Hedland labor deal and any fresh broker calls on Jansen next week. Monday’s ASX session will indicate if Friday’s drop was just a pause or if investors are rethinking BHP’s spending plans.
