BHP looks to take potash plant nuclear (copyright link)


through a third-party small modular reactor (SMR) provider, could replace much of that by the mid-2030s.

BHP looks to take potash plant nuclear

Matthew CranstonUnited States correspondent

Nov 26, 2023 – 2.14pm

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Washington | BHP is considering nuclear energy to power what will be the world’s biggest potash mine in Saskatchewan, Canada, in a move that would help the Australian mining giant achieve its net-zero emissions target by 2050.

A decision to pursue nuclear generation in a country where it has long been part of the energy mix raises further questions about Australia’s own interest in the clean but controversial energy alternative.

BHP’s Jansen potash project in Canada.

BHP is investing more than $US10 billion ($15 billion) in the Jansen potash project, making it the single largest project currently under construction at the group.

By 2026, the company expects to start producing more than 4 million tonnes of the salt and potassium compounds processed into fertiliser used to boost crop production at a time when global supplies are under pressure due to the war in Ukraine, one of the world’s biggest grain producers.

Electricity from fossil fuels will initially account for about 60 per cent of the mine’s Co2 emissions and gas used for heating the rest, but nuclear energy, whether from the local state-owned utility or through a third-party small modular reactor (SMR) provider, could replace much of that by the mid-2030s.

Rag Udd, president of Minerals Americas at BHP, told The Australian Financial Review that the mix of energy sources for the mine would ultimately depend on local generator SaskPower.

“We’re pursuing carbon-neutral electricity at Jansen, and aiming to get that by the mid-2030s, and we are working closely with the provincial crown utility provider to look at several options and technologies to actually enable that. Wind, solar or nuclear are potential options that are out there,” he said.

“We’re actually working very close with SaskPower to understand what are the options that actually help not only solve the challenges that Jansen might have in terms of net-zero, but also the provincial needs as well,” Mr Udd said.

BHP president minerals Americas Rag Udd: “Wind, solar or nuclear are potential options that are out there.” Bradley Kanaris

Australian law does not allow the development of nuclear energy technologies and Energy Minister Chris Bowen has been a critic of the controversial fuel as part of the country’s emissions reduction efforts.

While BHP mines uranium in Australia, Saskatchewan is also home to the world’s largest high-grade deposits and there are moves by SaskPower to develop nuclear energy, with the possible inclusion of small modular reactors.

“SaskPower is considering nuclear power as a future supply option,” SaskPower spokesman Joel Cherry said.

“We currently have no nuclear power in the province. And we won’t make a decision on whether to build a small modular nuclear reactor until 2029.”

BHP will need a lot of energy for the mine that extends 1 kilometre underground to what is essentially an ancient seabed of 3- to 5-metre-thick seams of the potash nutrient.

The company has already developed a plan to have more than 80 per cent of its underground equipment and vehicles go electric, further reducing its carbon footprint.

The company is also looking to switch from other fuels to further reduce emissions, including natural gas which is used to generate heat in the processing of the potash.

Simon Thomas, BHP’s Saskatchewan-based vice president of Projects Potash, said every energy technology possible, including small modular reactors, would be considered to power the mine to make it emissions-free and more cost-effective.

“We will look at whether or not other fuel sources can be used as a method of generating heat – that’s something that is out there for us to look at and consider,” Mr Thomas said.

“I talk to things like what is our fuel source for heat? What is the technology that we would implement for electricity generation and supply, and then see how those solutions suit our operation from an emissions perspective, an operational cost perspective, and in terms of the maturity and stability of those energy technologies.

‘Still too expensive’

“For electricity it’s about us working hand in hand with SaskPower around how they are approaching emissions on the grid more broadly.”

The mine is situated in about 130 kilometres from Saskatoon, where temperatures can drop to minus 30 degrees. It sits in a region characterised by pioneering prairie farmers.

Huw McKay, BHP’s vice president of market analysis and economics, said powering mines and mineral processing with nuclear energy was still too expensive, but that could change.

“For SMRs we would need to see it demonstrated that it can be done at a price point. At the moment, they’re still pretty expensive, so I don’t think we’ll be seeing them on mine sites soon,” he said.

“But if there’s one thing I’ve learned over the course of my career, that is underestimating technological change that can happen over a decade is a huge mistake,” Mr McKay said.

BHP’s potash play is a bet on the fertiliser commodity. The company is aiming for returns on the investment of as much as 18 per cent.

Last month BHP chief executive Mike Henry announced the approval of the second stage of Jansen worth $US4.9 billion.

“The stage-two investment advances BHP’s strategy to increase its exposure to commodities positively leveraged to the global megatrends of population growth, urbanisation, rising living standards and decarbonisation,” Mr Henry said

In 2010 BHP scrapped its then $39 billion bid for Canada’s PotashCorp after the Canadian government blocked the deal. BHP has since been buying up potash tenements in Saskatchewan and now controls leases covering about 30 per cent of the remaining potash reserves in the province.