This article first appeared on GuruFocus.

BHP Group (NYSE:BHP) shares fell sharply after the miner flagged a $2.3 billion write-down on its Jansen potash mine in Canada, driven by higher costs and delays tied to the project's expansion. The move marked BHP's biggest one-day share decline in 14 months, adding fresh pressure on a project that has already faced investor scrutiny over its scale, spending, and long development timeline.

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The company said phase two of Jansen will now cost $6.9 billion, up from an earlier estimate of $4.9 billion, with production expected toward the end of 2031. BHP shares closed 5.6% lower in Sydney on Friday, while its UK-listed shares fell 4.4% in London on Thursday. Barclays analysts estimate BHP has spent $20.3 billion on the project so far, with $4.1 billion now impaired.

Barclays analysts including Amos Fletcher said expected internal rates of return have declined, and now estimate total returns of 7.1% across the first two development stages. BHP does not expect total capital expenditure to rise for the 2027 fiscal year, though it did not provide estimates for later years. First production from phase one is still expected next year, while the mine could possibly become a century-long business that BHP believes may eventually rival its Australian iron ore operations in scale.