Thank you for the opportunity to speak with you today.
As a proud Canadian myself, it is great to be back in Canada visiting the teams in Saskatchewan and Toronto.
Today, I am going to focus on three key points:
- The exciting period of development ahead for the resources industry;
- The opportunities Canada has to benefit from this development; and
- Our plans for investment in Canada, and in particular our new Potash investment in Saskatchewan
And you will have to forgive me, but as a Canadian mining engineer who has worked all over the world with different commodities, I have been accused of being overly enthusiastic about Jansen and potash – so I have asked the organisers to keep me crisp on timing so we have plenty of time for questions.
In terms of the resources industry, we are in the midst of a truly dynamic period.
The resources industry has always been central to the industrial needs of the world, but right now we are also central to helping solve some of the world’s biggest challenges.
Challenges like decarbonisation; like building the infrastructure to change the way we use and create power on a massive scale; and like how we feed a growing population with increasingly scarce arable land.
The basic building blocks required to meet these challenges are what the resources sector brings to the table. Iron ore for steel. Nickel and copper for electrification and batteries. And Potash to boost agricultural productivity.
We need to produce much, much more of each of these, and we need to do it simply better than we ever have before: more safely, more productively and more sustainably.
Under the BHP 1.5 degree warming scenario – the details of which you can find in our Climate Change Report 2020 on our website – we expect the world would need to produce around twice as much copper in the next 30 years as it has in the last 30 years – and four times as much nickel.
So where will these minerals come from?
It is true that new resource deposits are getting harder to find and more challenging to unlock:
- They are deeper.
- They are more technically difficult to access,
- And they are often in countries with less stable economic or political conditions
So this creates a great opportunity for countries with accessible resources and stable economic and political conditions.
And Canada sits right at the heart of this opportunity.
Canada is already a critical contributor to the worlds resource needs, and resources are already an important part of the Canadian economy. For example:
- Canada ranks among the top five countries in the global production of 14 different minerals and metals1
- And in 2020, the minerals sector directly and indirectly contributed $107 billion, or roughly 5%, to Canada’s total nominal GDP2
Today I would like to talk about three commodities in particular – nickel, copper, and potash.
At BHP, we call these ‘future facing commodities’ – “future facing” because they are especially relevant to the needs of world in the future.
We have been increasing our exposure to these commodities for several years now.
And that investment includes a commitment to Canada, and to Canadians.
For example, we have opened our global exploration and development office in Toronto because it is a hub of excellence for mining – with talented people, great companies, and a mature capital market.
There are great opportunities here in Canada in nickel, copper, potash and other minerals – but there are also great Canadian companies that are exploring all over the world who are very good at what they do and we want to continue to learn from them, invest with them, and partner with them.
For example, we have signed a nickel exploration alliance with Midland Exploration for a nickel exploration program in Nunavik.
And in February we announced an investment of C$100m in Canadian owned Filo Mining, which is developing a copper, gold, silver project on the Argentinian-Chilean border.
Canada has untapped potential in future facing commodities, and importantly, it also has supportive business and government ecosystems that allows good companies to invest to deliver mutual benefit.
Now, shifting to our single largest investment in Canada – in late 2021, we committed to a C$7.5 billion3 investment in Stage 1 of the Jansen potash operation in Saskatchewan.
This investment opens a new front of growth for BHP.
We believe that Jansen has the potential to mirror some of our other large, basin investments like Western Australian Iron Ore and Escondida.
Like these deposits, we expect Jansen has the potential to be developed into a resource with a life span of over a century, and as a result, we want it be developed as a mine of the future.
At BHP, we are changing the old paradigms associated with the industry – we want this industry to proudly deliver the resource needs of the world, and in a manner that reflects the expectations of the future.
We want to deliver value through productivity, efficiency, diversity, and sustainability.
We believe that for us to be successful, the people around us must also benefit – and we do that in ways that we feel set us apart from other mining companies.
Jansen will support the local community through employment, with 3500 jobs at peak construction and around 600 ongoing jobs through operations.
Our goal is for the operational workforce to be gender balanced. We know it is an ambitious goal, and we are looking for the best and brightest across Canada who want to work in one of the most technically advanced mines in the world.
In addition, we are aiming for 20% indigenous employment by the end of FY2027… again, an ambitious goal – but we are confident this will make us a better operator and create value for BHP and Indigenous communities.
We have signed agreements with all 6 Indigenous communities near Jansen…agreements that aim to improve outcomes in education, economic development, health, and community well-being.
We will also continue to build capability within the community and support community organisations.
- For example, the team have invested C$35 million in community donations in the last 6 years.
- and we have invested C$20 million into co-sponsorship with SaskPower on the International Carbon Capture and Storage Knowledge Centre in Regina.
Finally, we are committed to emissions reduction, water stewardship, and cleaner mining.
- We expect Jansen to emit about half the carbon dioxide per tonne of product as compared to the average performer in potash mines in the Province.
- and to use about 60% less water per tonne than current third party average operation.
- Our underground mining and support fleet will be more than 80% battery electric vehicles, by consumption, and we’re pursuing 100% electrification.
- And we will pursue carbon neutral electricity to supply our operation through commercial partnerships.
There is a global need for more of the resources that Canada has in great quantity.
These resources are needed for decarbonisation, for raising standards of living, and to meet the needs of a growing population.
Canada and Canadians are well placed with the resources, skills, and conditions to meet those needs.
BHP is committed to operating sustainably and fairly, while generating economic benefit and social value in our communities, societies and countries where we invest and operate
We are here in Canada for the long haul.
We are excited about the future, and our role in delivering what the world needs, together.
1 MAC The State Of Canada’s Mining Industry | Facts & Figures 2021, https://mining.ca/download/36715/ (p22)
2 MAC The State Of Canada’s Mining Industry | Facts & Figures 2021, https://mining.ca/download/36715/ (p 4)
3 BHP approves investment in Jansen Stage 1 potash project