BHP Billiton has advanced into the feasibility study phase for its Jansen potash project in Saskatchewan, Canada.
The company has begun drilling and site preparation for the ground freezing process.
The Jansen project, which is estimated to produce about eight million tons per annum of potash, is expected to commence production in 2015.
BHP Billiton president Graham Kerr said the project has the potential to become one of the world's premier potash mines and the platform for a significant and scalable potash business.
"BHP Billiton's strategy is to develop and safely operate large, long-life, low-cost assets and we continue to make progress at our Boulder, Young, Burr and Melville sites. We look forward to continuing to work on our growth projects with our Canadian suppliers and host communities as we seek to build a significant presence in Saskatchewan," Kerr said.
Last year BHP Billiton funded $240m for the early development of the project.