11/10/2021 | Press release | Distributed by Public on 11/09/2021 21:07
Thursday, 21 October 2021
Thank you very much. As Jennifer mentioned, my name is Laura Tyler, and I am the Chief Technical Officer at BHP.
BHP is a global, diversified resources company, with a very long history.
A history that stretches back to the late 19th century, where the foundations of our company were in tin, lead, bauxite, silver, and iron ore.
At the time, these were the commodities critical to industry and livelihoods; they were vital to build the products and infrastructure that increased prosperity and living standards.
We sit here now almost 150 years later and the challenge is still the same.
We produce the commodities the world needs to protect our livelihoods and increase our standards of living.
As decarbonisation, or the pursuit of net zero emissions, draws sharper focus from businesses and governments worldwide, the mining industry remains absolutely central to that challenge.
What we produce is vital for the world to continue to grow, and many of our products will help make the transition to cleaner energy possible.
As BHP's Chief Technical Officer, my role sits at the intersection of some of the key opportunities that face our industry.
Innovation, exploration, and how we identify and effectively implement technology.
This is central to our business, and it's essential to our future.
BHP's purpose is to bring people and resources together to build a better world.
We will provide minerals that are essential to the decarbonisation effort; and we are committed to doing so sustainably and ethically.
Today I have been asked to speak to you about the role of critical minerals in the energy transition.
About the essential resources the world needs for decarbonisation, the ways in which we can find and produce them ever more sustainably, and the opportunities for technology and global collaboration to achieve net zero emissions - or how we can all contribute to a Technology to Zero goal.
Role of minerals in a clean energy future
It is clear that if the world is to meet the Paris Agreement 1.5 degree goal, it will need substantially more of the commodities essential for decarbonisation.
Our analysis under our 1.5 degree scenario shows that to aid the development of renewable technologies and distribution of new charging infrastructure, copper production would have to double over the next 30 years.
And to power the next generation of battery technology and the forecast demand for electric and hybrid vehicles, nickel production would have to increase nearly four-fold.
Steel is fundamental to support decarbonisation through wind farms, solar panels, and transport and transmission infrastructure.
Under our 1.5-degree scenario, the world is expected to need almost twice as much steel in the next 30 years as it did in the last 30.
It is clear then, that even with recycling, the target of net zero emissions cannot be achieved without the mining industry and many of the essential minerals we produce.
A world with less carbon in it will necessarily have a lot more mining.
So how does the industry meet this demand and do it in a sustainable way? The answer is the same way we always have - through innovation and technology.
Technology enables us to get more of the critical minerals we need; and the critical minerals make technological solutions a reality.
I'd like to tell you a bit more about just how critical nickel and copper are in particular to our low carbon future and what BHP does to produce more of it, in an increasingly sustainable way.
BHP and nickel
I will start with nickel…
BHP continues to position itself to provide nickel as an essential commodity for decarbonisation.
We do that in Australia at Nickel West, one of the most sustainable nickel producers in the world.
85% of the nickel we produce at Nickel West is used for batteries - and nickel makes up 55 per cent of metals in lithium-ion battery cathodes.
Our nickel is also used in process plants, for power generation, chemical production - and to make stainless steel for home appliances, kitchen materials, and medical instruments.
We have just started up our new nickel sulphate plant that converts nickel powder into the high purity sulphate needed for electric vehicle batteries.
The plant will supply enough nickel for 700,000 electric vehicles' batteries per year.
At full capacity, that's the second largest in the world.
The world will need far more of it.
Global electric vehicle sales are expected to approach 5.5 million units this calendar year, which was the size of the entire global electric vehicle fleet just three years ago.
We have an agreement to supply nickel to Tesla, and to a joint venture between Toyota Motor and Panasonic who in turn supply batteries to electric vehicle makers.
And we're also seeking growth in nickel, to supply that substantial, growing demand.
More and more, our customers want ethically sourced, low carbon footprint supply.
So building these factors into our plans and processes isn't just the right thing to do - it's also beneficial commercially - it makes business sense.
So we continue to work to decarbonise our supply chain.
Earlier this year, BHP announced a power purchase agreement to supply Nickel West with solar power. The agreement will supply up to 50 per cent of electricity needs at the Kwinana Nickel Refinery.
Our own solar farm and battery energy storage system will power the mines and concentrators, and we have undertaken studies for two wind power installations to secure additional renewable power.
And we are studying the potential to use tailings from our Nickel West operations to capture and store carbon, permanently and safely.
This is called mineral carbonation.
Much like trees can store carbon dioxide straight from the atmosphere, many minerals naturally remove carbon from the air.
Our tailings at Nickel West are high in magnesium oxide, which can pull carbon dioxide out of the air to create magnesium carbonate.
That material can then be left safely in situ, or used in building materials like carbon neutral cement or plasterboard.
We have a study program underway and we are preparing to conduct some field trials this financial year, along with some engagement with external research teams.
It's early days but it's a really exciting project with great potential.
Copper is another mineral absolutely essential to decarbonisation.
We currently mine copper at Olympic Dam in South Australia, and in Chile, where we operate the world's largest copper mine at Escondida.
Copper is key to the radical urbanisation of large populations in China and India, electrification of energy and transportation, and of course to renewable energy sources like wind and solar.
In 2020, we produced 1.7 million tonnes of copper, which is enough to make over 420,000 wind turbines.
That drive for "cleaner and greener" mining extends to our copper operations too.
We seek to produce more metal per tonne of water used, carbon dioxide generated, waste generated or kilowatt hour of energy consumed.
Our copper operations in Chile - at Escondida and at Spence, which is part of Pampa Norte, are great examples.
Those assets have begun to operate with renewable energy and will be supplied with 100% renewable energy from 2025.
This will displace more than 3 million tonnes of carbon dioxide per year from 2022, the equivalent of the annual emissions of around 700,000 combustion-engine cars.
Escondida also operates with 100% desalinated water, and we began using desalinated water at Spence in December last year - so we have significantly reduced our draw on groundwater reservoirs in northern Chile.
And back in Australia, we've just announced renewable energy supply arrangements to enable Olympic Dam to reduce its emissions position to zero for 50 per cent of its electricity consumption by 2025, based on current forecast demand.
Using technology to find and mine copper
While the world needs far more copper and nickel, it has become a greater technical challenge to find and extract more of what we call 'Tier 1' resources; the best deposits are deeper underground.
If we are to provide the critical minerals for a clean energy future, exploration - which is a key part of my role at BHP - is an imperative.
The bulk of the exploration industry thinks that the golden age of discovery - an era of at-or-near surface exploration - is behind us.
But maybe the golden age of discovery is ahead of us.
Because if we harness technology we can make the Earth at 400 metres depth as transparent to exploration as the surface of the Earth is today.
We use real-time sensors, multi-physics arrays, and data analytics to accelerate decision-making, reduce the logistical effort, and improve confidence in discovery.
BHP is collaborating with industry partners to develop the next generation of sensors to maximise data collection and minimise the footprint on the ground.
This all helps to find more copper and more nickel to meet the world's needs, and do it with a smaller environmental footprint.
Further decarbonisation along the supply chain
At BHP as we work on decarbonisation, we consider the whole supply chain.
We recently released our Climate Transition Action Plan, in which we extended our own emissions reduction goals and targets.
In 2020, we set a medium-term target to reduce our operational emissions by at least 30 per cent from FY2020 levels by FY2030.
Our Scope 3 approach is to work with customers and suppliers to support their own greenhouse gas emissions reductions, in pursuit of the long term goal of net zero Scope 3 greenhouse gas emissions by 2050 for our reshaped portfolio.
We do this through research partnerships, through existing technology, and through emerging technologies - technologies like blockchain.
We have begun to use blockchain to support traceability and bring greater transparency along supply chains.
In this way we can accurately track and trace where products were sourced and how much carbon is emitted as they move through the supply chain.
In August, we started the first industry pilot blockchain trade in copper concentrates with China Minmetals. We aim to improve efficiency and security in the settlement process, and also bring greater transparency over product quality through digitalising certification.
In the future, this technology could also be used for product based sustainability reports between customers and suppliers.
We have also just completed our first 'carbon neutral' copper transaction. This is very exciting and involves delivery from our Chilean mines to processing facilities in the US run by Southwire, a large US copper cable and wire manufacturer.
This pilot traced BHP copper cathodes and associated emissions through Southwire's rod production operations. This transparency will help to track and understand emissions in the copper supply chain.
The opportunity for industry collaboration
At BHP we see a new era of collaboration ahead of us…
The various partnerships I've described are part of a larger picture -decarbonisation is not just an opportunity for industry collaboration; it is an imperative for industry and government to pursue better outcomes right along the supply chain.
The path to net zero cannot be achieved if the mining industry does not provide the essential minerals; but production must be pursued alongside other sustainability requirements.
As the world comes together at the meeting of COP26 in Glasgow, this presents an opportunity for all countries to ensure their commitments and plans put us on the path…
To achieve the long term temperature goals of the Paris Agreement,
To work together on a mutual pathway to net zero emissions -
And to bring people and resources together to build a better world.
Thank you for the opportunity to speak with you today.