By Rajasik Mukherjee and Sneha Kumar
June 19 (Reuters) - Shares of BHP Group slipped the most in more than a year on Friday, after the miner flagged cost overruns and a $2.3 billion charge linked to it at its Canadian potash project.
The world's largest listed miner's stock settled at A$61.4, falling 5.6%, its worst day since April 7, 2025.
The mining major's decline also spilled over to the broader mining index, which ended 4% lower.
"BHP’s slide is a direct reaction to climbing development costs at
its Jansen potash project," said William Taylor, COO and portfolio manager at ETF Shares.
"Although the long-term outlook for Jansen remains highly attractive, the market is reacting sharply to the immediate capital intensity."
The Melbourne-based firm, late on Thursday, raised the estimated investment for the Jansen project's second stage to $6.9 billion from $4.9 billion due to inflation, design development and other pressures.
It was the third time BHP exceeded cost estimates across the two stages of the Jansen potash project, underscoring a fresh setback to its decade-long strategy to diversify beyond copper and iron ore.
BHP has picked potash, used in fertilisers, as one of its pillars of future growth, betting that it would be essential for food security and more sustainable farming.
Earlier this year, the company announced that the first stage of the project was expected to cost $8.4 billion, nearly 50% higher than the 2021 approval, and will begin production in mid-2027.
The miner on Thursday said it maintained its annual capital expenditure forecast at $11 billion for the 2027 financial year.
Once fully ramped up, it will be one of the world's largest potash mines, as per BHP's website.
Jansen is expected to capture 10% of the global potash market, the company added, which is also used in industrial chemicals, animal feed and pharmaceuticals.
(Reporting by Rajasik Mukherjee in Bengaluru; Editing by Nivedita Bhattacharjee and Harikrishnan Nair)
