BHP has high expectations for the future, as first production at its South Flank iron ore project in the Pilbara coincides with continued government stimulus and soaring commodity prices.
BHP chief executive officer Mike Henry spoke in a very positive light at the Bank of America Metals, Mining and Steel Conference this week.
On top of an expansion to the Spence copper mine and multiple developments to its oil and gas portfolio, BHP has far surpassed the point of no return at one of the world’s largest iron ore operations – South Flank.
“In the next few days, we will announce first production at the 80 million tonne per annum South Flank iron ore project, with its higher grade and lump fraction,” Henry said.
“(These projects were) all brought in on time and on budget in spite of COVID-19, and perfectly timed given where copper and iron ore prices are at.”
Henry gave his opinions on how the world will deal with greater uncertainty and volatility in markets and global politics.
He expected shareholders, communities and wider society to play an increasingly large part in the success of decarbonisation and global economic growth and development – which will need to overlap.
“Successful companies will be those with a clear strategy and sense of purpose, who are exceptional operators and allocators of capital, are in tune with the changing world around them and who focus on bringing this all together to create long-term value for all their stakeholders. This is BHP,” Henry said.
Despite this reliance on wider society, governments will remain vital in facilitating the growth and exploration of resources for clean energy solutions.
Henry said more and more governments are getting on board with such commitments.
“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,” Henry said.
“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.”
To continue playing its own part in decarbonisation, BHP’s latest transition to cleaner energy was seen at the Olympic Dam operation in South Australia, where a 95-tonne crane has begun operating at the electro-refinery.
BHP Olympic Dam asset president Jennifer Purdie said the crane – used to submerge 360-kilogram copper anodes – will increase production and advance the supply of copper to global customers.
“The new refinery crane will improve operational stability and reliability in our refinery, allowing us to operate more safely and efficiently, and support increased production volumes over the long term,” Purdie said.
“Copper cathode from Olympic Dam is sought-after for its quality and purity, and will be increasingly in demand as an essential product for global decarbonisation.”