BHP’s plans for a new management structure in Australia looks set to provide new cost savings under the watch of new Minerals Australia operations president Mike Henry.
The former coal business boss took over from former iron ore president Jimmy Wilson in February, and now oversees the Pilbara iron ore unit, Olympic Dam’s copper and uranium, NickelWest and the east coast coal assets.
Speaking at the Global Iron Ore and Steel Forecast Conference in Perth, Henry said he believed BHP’s halving of cash costs for iron ore in the past three years was only the start of a new wave of productivity and cost improvements.
Under Wilson’s rule BHP cut 47 per cent of the cash cost of iron ore production since 2013, with $4.3 billion in productivity gained over the past two years.
The West Australian reported that Henry began his rule by dismantling the iron ore business hierarchy, with the bulk of new appointments coming from the east coast coal business.
Henry said the new structure will see centralisation of HR and purchasing, while executives on the ground will be responsible for safety, volume and cost improvements.
“From an operational perspective, one of the as-yet not fully tapped opportunities is to be able to take specific best-practices on maintenance, or on production, on planning and so on, and to replicate that quickly across all of the operations,” he said.
“By bringing regional assets together under one umbrella, we’ll be able to foster that sharing and replication of best-practice and that will happen more quickly.”