Shares of BHP Group dropped after the mining giant flagged a $2.3 billion writedown on its Jansen potash project in Canada. Cost and time overruns for the expansion pushed the phase two price tag to $6.9 billion, a sharp increase from the previous $4.9 billion estimate. Production for this stage now targets late 2031.

Barclays analysts estimate the company spent $20.3 billion on the project so far, with $4.1 billion now impaired. This spending spree slashed expected internal rate of returns to 7.1%, roughly half of what BHP originally projected. Investors have long questioned the massive price tag of the Saskatchewan-based mine since its 2021 approval.

BHP accelerated the expansion in 2023 when fertilizer prices spiked following Russia's invasion of Ukraine. However, prices have since fallen while construction costs spiraled. Despite these setbacks, the company views the mine as a potential peer to its Australian iron ore operations. Phase one production begins next year.