Unlocking Australia’s ‘copper kingdom’

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BHP chief operating officer Edgar Basto at Austmine 2023 in Adelaide, South Australia
‘We see longer-term opportunities and potential synergies … that could put SA on the global copper map’

Chile holds the mantle, but South Australia’s Gawler Craton could be the world’s next “copper kingdom”, the Austmine 2023 conference in the state’s capital, Adelaide, heard this week.

“An exciting prospect”, is how BHP chief operating officer Edgar Basto described the opportunity in front of the A$225 billion company to elevate South Australia’s status in its 1.7 million tonnes a year copper production portfolio and make the most of the Gawler’s “huge untapped potential”.

Speaking at Austmine 2023, Basto said water, energy and people were among the factors that would play heavily into BHP’s now accelerating assessment of its copper growth options following this month’s $9.6 billion acquisition of OZ Minerals and its Carrapateena and Prominent Hill operations in the Gawler region.

The region accounts for less than 20% of BHP’s mined copper output but now looms larger in the company’s capital allocation plans as it eyes a scheduled 2027-2028 major copper smelter shutdown at its flagship Australian asset at Olympic Dam. CEO Mike Henry spoke earlier this year about increasing smelting capacity at Olympic Dam to “de-constrain the underground … [and] create more efficient operations”.

“So with an eye to not wanting to take the smelter down twice, that’s [2027-2028] probably the timeframe that we’d be targeting whether it be Olympic Dam standalone, Olympic Dam with Oak Dam, or a combination with the OZ assets, all of this can be looked at in quite some detail after the transaction is concluded,” he said.

Basto said at Austmine 2023: “We have in front of us the opportunity to create a new copper province for South Australia that is globally first class. It can bring new jobs, new skills, local business opportunities and economic growth for this state.

“But it will require us all to step up.

“This is a global competition.

“As global demand for copper increases, global competition for investment to meet that demand is also heating up. We are seeing this in places like the US and Canada, which have brought in new policies and strategies to attract major investment in critical minerals.

“Here and now we are facing the battles of inflation and pressure on global supply chains.

“Every copper producer globally is facing these same challenges.

“Here in Australia we will have to fight harder.

“South Australia is well placed and is match fit.

“It knows how to compete with global players – and carve out its expertise – in industries such as aquaculture, in defence, wine, space technology and in health. In mining, we must continue to work in collaboration with the government, our traditional owner partners, and local communities to realise our potential.”

Basto said “anyone who is familiar with the geography of the Gawler Craton will at once see the opportunity that all of this presents”.

“We have three existing mines that are attractive in their own right, but if we start to look at them together, we see the longer-term opportunities and potential synergies to build a copper province that could put SA on the global copper map.

“Here in South Australia, we have nearly 70% of Australia’s copper resources but we produce just under 30% of Australia’s mined copper production.”

More broadly, according to Geoscience Australia, “Australia is ranked number two in the world for copper resources, but number eight in the world for mined copper production”.

“The Gawler Craton has huge untapped potential… Just imagine for a moment that we can develop a mining hub centred around a smelter that brings even more of SA’s high quality copper to global customers.”

Basto identified the availability and cost – fiscal and social – of water and energy as potential constraints on investment and growth. While the Austmine event spotlight is mainly on technology and innovation, Basto was not alone in emphasising the importance of people, in various ways, in the growth equation.

“There is enormous talent and technical ability here in South Australia,” he said.

“People and culture is at the heart of our approach to integration. By combining BHP and OZ Minerals assets, and the skills and technical expertise of our people, we can build something that is greater than the sum of our parts in South Australia.

“In the technology and innovation space, an innovation team is actively testing new ways of finding and extracting copper.

“We are looking at technologies to improve efficiency in metal recovery, reduce environmental footprints and conserve water.

“We’re investing heavily in skills and training. At the end of 2020, we pledged to fund 2500 new trainee and apprenticeships programs across Australia over the next five years. Today, we have welcomed 800 new students, including more than 350 graduates already.

“In South Australia, we established the Olympic Dam Underground Mining School of Excellence to create new opportunities for people with our experience in mining.

“Around 300 people complete the program each year and enter into roles at Olympic Dam. Our people are paid to train and move into roles with BHP when they graduate.

“This program, in addition to our graduate and intern programs, ensures we are reaching all the big thinkers and bright minds to open up opportunities here in SA.

“This is not an overnight endeavour and we cannot do it alone.

“There is value here for everyone and our collective effort will help us seize the opportunity for South Australia and for Australia as a whole.”


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