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BHP readies to grow copper output

BHP CEO Mike Henry

BHP CEO Mike Henry

18th May 2021

By: Esmarie Iannucci

Creamer Media Senior Deputy Editor: Australasia

     

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PERTH (miningweekly.com) – Diversified miner BHP has unveiled plans to grow output from its ‘future-facing commodities’, with CEO Mike Henry saying that plans were in place to increase average copper production over the next five years by more than 300 000 t/y.

Speaking at the Bank of America Securities 2021 Global Metals, Mining and Steel Conference, Henry noted that the company’s current portfolio was well positioned to support the expected increase in demand for commodities that would assist in global decarbonisation and economic growth.

“Government stimulus and pro-growth agendas, which are expected to remain in place for an extended period, are anticipated to lead to robust growth, a lift in inflation and solid demand for mineral resources and oil and gas. This is occurring at a time when our industry’s capital discipline and decline in exploration success over a number of years means there are fewer high quality growth projects in the industry pipeline to meet this demand,” Henry said.

“The drive to more rapidly decarbonise the globe may also accelerate demand for many of the products we produce. A growing number of governments are committing to tackling climate change with greater ambition and are cooperating to do so. A transition to a world where warming is limited to no more than 1.5 degrees above pre-industrial levels is positive for BHP and would allow us to create significant value.

“In a Paris-aligned scenario, we expect a more than doubling of the amount of primary copper and a quadrupling of the amount of primary nickel demand over the next 30 years, as was produced over the last 30.

“Demand for steel will almost double on this basis, and potash will be vital for more efficient agricultural practices. And as the shift to cleaner energy sources occurs, the world will still need oil and gas to power mobility and everyday life on its pathway to decarbonisation,” he said.

Henry noted that BHP remained focused on systematically unlocking even greater performance from its equipment and infrastructure, saying the company was enabling its people and investing in capability.

“Our portfolio is well-positioned. We produce commodities essential to everyday life, global economic growth and the energy transition. Around 60% of our production is in commodities that support steel-making, which we anticipate will see strong demand as the world decarbonises. Around one-quarter of our portfolio is currently in ‘future-facing commodities’, which for us are copper, nickel and potash, and we expect to grow this over the coming years. This includes an increase in average copper production over the next five years of more than 300 000 t per annum, equivalent to adding another Spence to the portfolio.

“Given our rock-solid foundations of a strong balance sheet and disciplined approach to capital allocation, we are positioned well to be able to continue to pursue new opportunities for growth. As we have done for over a century, we will continue to meet the world’s changing and growing demand for commodities.”

Edited by Creamer Media Reporter

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