BHP Billiton offers to make up government revenue loss

A harsh reception from the province of Saskatchewan won't stop BHP Billiton from chasing PotashCorp right to the end.

A letter posted Wednesday morning on the Australian company's website says BHP will continue working towards approval with the federal government despite the province trying to block the deal.

Saskatchewan Finance predicts the province would lose $3 billion over a decade as a result of the deal due to the taxes lost from the proposed BHP Jansen mine project.

But now, BHP executive Andrew MacKenzie is suggesting his company could come up with a restructuring so as to save the province that loss, should BHP be successful in acquiring PotashCorp.

“If we had a separate company building the Jansen mine and PCS remained separate, they (the taxes) would be the same. So we would completely level the playing field and take the tax issue off the table,” said MacKenzie.

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Wall isn't so sure.

“The challenge with that is that these are promises and in every single takeover of a natural resource company in our country of late, promises have been made and promises are broken,” said Wall.

Wall wants to see a dollar for dollar matching of the lost revenues expected from the deal in order to feel the province had been adequately compensated.

He won't reveal at this time what he wants to see from BHP in order to have his mind changed, saying we will have to wait until he addresses the Chamber of Commerce on Thursday during a lunch.

Wall is meeting with cabinet on Wednesday in order to make its final decision on whether to support the takeover or not.

The final decision rests in the hands of Tony Clement and Industry Canada. However, from the beginning, Prime Minister Stephen Harper has said that Saskatchewan's opinions will weigh heavily on their final verdict.