Green Metals Hunt Draws World’s Biggest Miner to Frozen Tundra
(Bloomberg) -- BHP Group is moving its exploration headquarters to Toronto in the latest move by the world’s top miner to focus its growth pipeline on future-facing minerals such as copper and nickel.
The switch to Canada’s most populous city comes after BHP last August entered a partnership with Midland Exploration Inc. to undertake nickel exploration in the far north of Quebec province, where average winter temperatures are close to minus 30 Celsius (-22 Fahrenheit). BHP is also supporting Midland’s hunt for copper in the same region.
“Nickel is fast becoming the ‘work horse’ of battery technology, playing an essential role in the world’s efforts to decarbonize,” BHP’s Chief Technical Officer Laura Tyler said in a speech to a mining conference in Toronto. She forecast a “golden age” for exploration in the years ahead, where innovation and new technology would help to unlock resources of the future.
Spending on exploration in global minerals powerhouse Australia -- BHP’s home base -- rose in the December quarter to its highest in over seven years amid mounting talk that the commodities complex is entering a new supercycle. This is spurring miners to seek new deposits across the globe of the minerals that will drive the clean energy transition, including nickel and copper.
“We’ve been very clear that we want to secure more options in future-facing commodities,” BHP CEO Mike Henry said on a shareholder call on Thursday. Current high asset prices were making value-adding acquisitions in those sectors unlikely, Henry said, adding that would mean even more focus on exploration to unlock new resources.
Nickel production would need to increase nearly fourfold to meet forecast demand for electric and hybrid vehicles, Tyler said Wednesday. Likewise, copper output would also need to grow exponentially to meet demand from sectors including renewable power generation and fast-charging infrastructure.
BHP expects to have around 50 staff in the Toronto office, including the senior exploration leadership team. The unit was previously based in Santiago, Chile, and the new location, closer to the company’s main markets, is expected to open up more opportunities in funding and recruitment.
“To own the best assets in the best commodities, you have to look for them and develop them well ahead of time,” Tyler said. “To do so, we need to imagine what the world could look like in 50 or even 100 years from now.”
©2021 Bloomberg L.P.