Jansen capex increase highlights growing execution risks

Research evidence excerpt

Jansen capex increase highlights growing execution risks

Deutsche Bank Group

Deutsche Numis Research

Rating Company Date

Hold BHP 18 June 2026

Company Update

Europe

United Kingdom

Reuters Bloomberg Exchange Ticker Price at 17 Jun 2026 (GBP) 3,480.00

BHPB.L BHP LN LSE BHPB

Price Target (GBP) 2,600.00

Metals & Mining

Metals & Mining ADR ISIN 52-week range (GBP) 3,480.001,708.50-

BBL US05545E2090

Jansen capex increase highlights

Valuation & Risks growing execution risks

Liam Fitzpatrick

Jansen Stage 2 capex increase and linked impairment Research Analyst

Earlier today, BHP announced the results of its detailed review of the Jansen Stage +44-20-754-13233

2 potash project in Canada. The capex budget has been increased from $4.9bn to

Bastian Synagowitz

$6.9bn with first production expected in late FY31, two years later than the original Research Analyst

schedule. BHP has also announced a $2.3bn impairment for Jansen reflecting +41-44-227-3377

higher capex for Stage 2 and future potential expansions. Following the recent

Cody Hayden

increase in capex for Stage 1, a sizeable increase for Stage 2 had been expected,

Research Analyst

although the 40% increase is at the upper end of market expectations. As seen for

+44-20-754-13230

Stage 1, the majority of the cost increase for Stage 2 is from additional construction

hours, scope changes and inflation. Stage 2 is currently only 16% complete,

highlighting the risk of further overruns in the years ahead.

With the potential approval of three major copper projects over the next 12-18

months (Vicuna, South Australia and Escondida at total guided capex of $16-21bn),

BHP is entering a higher risk project execution phase. Group capex guidance

remains unchanged at ~$11bn pa for FY26/27, but this excludes BHP's 50% share