With the global demand for copper increasing, BHP is looking to boost its investment in the commodity, with a particular focus on Chile.
BHP operates and owns 57.5 per cent of the world’s largest copper mine, the Escondida operation in Chile, and wholly owns the Pampa Norte copper operation in northern Chile.
This complements BHP’s copper assets in Australia (Olympic Dam) and the United States (Resolution), the latter which it shares with Rio Tinto.
Speaking at the 2022 CRU World Copper Conference in Santiago, Chile, BHP Minerals Americas president Ragnar Udd said the company was looking to commit more than $10 billion of further investment in Chile.
Udd suggested that while Chile was an undoubted copper success story, the region was facing numerous obstacles which require further attention.
“There are several headwinds,” Udd said. “Copper productivity has declined in recent years, and there are challenges with declining grades and rising costs. Other countries are also competitive and are vying for capital in a market that is internationally mobile.”
Udd said the investments would aim to create mutual benefit for at least the next 50 years and would focus on several different objectives.
“We are looking at things like a new concentrator and leaching processing facilities, developing new mining areas, and investments in decarbonisation to reduce Scope 1 emissions, ultimately to net zero,” he said.
“We are eager to grow. These investments would bring new jobs and shared prosperity for the communities and society in which we operate, and we want to ensure that our communities, employees, and partners come along on this journey.
“But … these investments need the right set of conditions. These conditions are well known, but worth repeating – long-term investments in mining require fiscal stability, legal certainty, and a clear pathway to permitting.”
BHP has not been shy about its belief in base metals. At the Australian Financial Review Business Summit in early March, BHP chief executive officer Mike Henry spelled out the current situation.
“To frame it up, the world’s going to need probably about two times as much copper over the next 30 years, 34 times as much nickel, even two times as much steel to support the energy transition,” he said.
Henry said that “for two times more copper, you’re actually going to need more than two times as much mining”.
Sounds like the $10-billion Chile investment could be aptly placed.