BHP Minerals Australia President, Mike Henry, today outlined plans to grow value and improve returns on capital across the Company’s Australian operations.
Speaking to investors and analysts at a briefing in Adelaide, Mr Henry said BHP’s large, long-life, low-cost Australian assets underpin current margins and future optionality.
“The quality, scale, concentration and location of our assets support improvement initiatives, compelling latent capacity options, efficient technology deployment and attractive investment opportunities.
“By sharing knowledge and replicating best practice across our global portfolio, we’ve been able to substantially reduce unit costs at our Australian mining operations over the last five years. But we have further to go. We can make ourselves safer and even more productive, and expect to lower our unit costs by a further 10 per cent over the medium-term.
“Through strengthening our maintenance capability and processes, including by bringing in expertise from other industries, and through better leveraging technology, our global Maintenance Centre of Excellence is enabling a step-change in maintenance performance across BHP. With our global technology initiatives and asset-level programs to unlock resources and lower costs, we expect our Australian mining operations to deliver US$1.6 billion of additional productivity gains over the next two years,” Mr Henry said.
“We also have a suite of attractive medium-term investment opportunities. While these remain subject to our strict Group-level capital allocation framework tests, with average returns potentially exceeding 40 per cent, they are well placed to compete for capital.”
Mr Henry highlighted the Brownfield Expansion option (BFX) at Olympic Dam as an example of a project with the potential to deliver sustainable returns to shareholders, government and the local community.
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