Mining giant BHP Billiton, in the midst of putting various other projects on hold, now doesn't expect to seek the final blessing from its board for its potash play in Saskatchewan anytime in fiscal 2013.
The Australian/British mining firm on Wednesday released its results for the year ending June 30, logging overall profit of US$15.42 billion on $72.27 billion in 2012 revenues, down 35 per cent from $23.65 billion on $71.74 billion in revenues in fiscal 2011.
"With 20 major projects currently in execution with a combined budget of US$22.8 billion, BHP Billiton is largely committed for the 2013 financial year," the company said. "No major project approvals are expected over this timeframe."
"Various operations and projects" in recent months "have either been suspended, closed early or changed in status," Billiton noted.
Those include suspension of its proposed Olympic Dam multi-mineral expansion project in South Australia, suspension of production at its Temco manganese alloy site in Tasmania, permanent closure for its Metalloys plant in South Africa, "indefinite cessation" of production at its Australian coal mine, Norwich Park, and "suspension of other minor capital projects."
Billiton in June last year picked up its required environmental approvals from the Saskatchewan government for development of its potash project at Jansen, between Saskatoon and Yorkton.
The company in June last year also approved US$488 million in further investment in the Jansen project's feasibility study stage, and at that time expected "final approval to proceed with Jansen" would be sought from the BHP Billiton board "in the 2012 calendar year."
Bill Boyd, Saskatchewan's minister of the economy, was quoted last week as saying he expected Billiton to be "clarifying (its) investment decision" at Jansen, probably within "days, not weeks."
Right now at Jansen, two underground shafts to support the operation are "well advanced and will be fully excavated by the end of 2014," a company spokesman said in an email from Australia on Wednesday.
Billiton, he said, has also completed 25 km of "exploration drilling in the wider Saskatchewan basin" in 2012.
That said, Billiton's "existing pre-commitment funding" for the Jansen site is expected to allow the company to "further advance" there in 2013, as it works on final engineering design and mining lease conversions -- both of which are needed before the project can go to Billiton's board for approval.
"More generally, we are largely committed for the 2013 year and no major project approvals by the board are expected over the timeframe," the spokesman reiterated.
The news comes as one of Billiton's rivals, Vale, said last week it would be reconsidering its Kronau potash project southeast of Regina, and it "will not be implemented now."
Billiton, in Wednesday's year-end report, also booked US$314 million in costs tied directly to its thwarted 2010 takeover bid for Saskatoon-based PotashCorp.
That charge included $240 million in fees from its $45 billion debt facility, plus $74 million in lawyers' and accountants' fees and other charges.
Sask. sees BHP potash mine proceeding, Vale plan stalls,
Aug. 17, 2012
Billiton potash project gets Sask. environmental approval,
July 1, 2011