Tag Archives: Mike Henry

BHP signs third low-carbon steelmaking partnership

BHP has signed a memorandum of understanding (MoU) with China’s HBIS Group Co Ltd, one of the world’s largest steelmakers and a major customer of BHP’s iron ore, with the intention of investing up to $15 million over three years to jointly study and explore greenhouse gas emission reduction technologies and pathways.

Under the partnership, BHP and HBIS Group intend to collaborate on three priority areas: hydrogen-based direct reduction technology, the recycling and reuse of steelmaking slag, and the role of iron ore lump use to help reduce emissions from ironmaking and steelmaking.

The partnership aims to help both companies progress toward their climate change goals and support the steel industry’s role in helping to achieve China’s ambitions to be carbon neutral by 2060.

BHP’s Chief Commercial Officer, Vandita Pant, said: “We view decarbonisation of the steel industry as a complex puzzle that requires multiple technological solutions across the value chain over different time horizons. By forming this third low-carbon steelmaking partnership with HBIS Group, we are focusing on additional components, such as the role our products play in hydrogen-based steel production, that complement our other partnerships and support for endeavours in emissions reduction and capture from the traditional blast furnace route.”

In February, the mining major signed a similar MoU with leading Japanese steel producer, JFE Steel, while, in November 2020, BHP and China Baowu signed a pact that could see up to $35 million invested in tackling greenhouse gas emission reductions in the global steel industry.

BHP’s investment would be drawn from its $400 million Climate Investment Program, established in 2019 to support projects, partnerships, research and development to help reduce Scope 1, 2 and 3 emissions.

BHP Chief Executive Officer, Mike Henry, said: “BHP has a long and trusted relationship with HBIS Group, and we are pleased to establish this strategic partnership to explore new ways to reduce emissions from steelmaking. Global decarbonisation will require collaboration and collective effort, and our work with partners such as HBIS Group will build on our own actions and help reduce emissions right through the value chain.”

Chairman of the World Steel Association, Party Secretary and Chairman of HBIS Group, Yu Yong, said: “The signing of the MoU fully demonstrates the two companies’ commitment to creating a green and low-carbon future across the value chain and a shared sense of responsibility to address climate change together, with a common vision to ‘contributing to a community of a shared future for mankind’. This partnership ushers in a new chapter for the two companies to deepen our strategic cooperation and to achieve collaborative development.”

BHP has also been active in other areas to reduce emissions, including awarding the world’s first LNG-fuelled Newcastlemax bulk carrier tender and the first LNG supply agreement for those vessels, and renewable energy supply contracts for BHP’s Queensland coal mines and Nickel West operations.

More OEMs join the ICMM’s Innovation for Cleaner, Safer Vehicles initiative

The Innovation for Cleaner, Safer Vehicles (ICSV) initiative – a supply chain collaboration between the International Council on Mining and Metals (ICMM) and original equipment manufacturers (OEMs) – has made significant progress towards understanding what is needed to transform today’s fleet of mining vehicles into tomorrow’s new generation of cleaner, safer vehicles, members of its CEO Advisory Group announced today at IMARC Online.

The ambitions of the ICSV initiative are to introduce greenhouse gas emission-free surface mining vehicles by 2040, minimise the operational impact of diesel exhaust by 2025 and make vehicle collision avoidance technology available to mining companies by 2025.

Two years on from announcing these ambitions, eight new OEMs have joined the initiative, taking the number of participating OEMs to 19, the ICMM said. This includes 3MTech, Behault, Future Digital communications, MTU, Miller Technologies, Miller Technologies, Nerospec, Newtrax and Torsa, the ICMM confirmed to IM.

ICMM members, representing around 30% of the global metals market with over 650 assets, have undertaken assessments to establish a clearer view of the progress made at site level towards each ICSV ambition. These assessments indicate ICMM members are generally at early stages of maturity in the journey, and show what progress will look like for each ambition, the ICMM said.

“This significant representation of industry can speak with an aligned voice, on aligned objectives with OEMs and third-party technology providers,” it added. “In its first two years, the ICSV initiative has achieved the critical step of sending strong signals to OEMs and third-party technology providers on their requirements, and on what is needed to accelerate development and adoption of technology across the industry.”

The initiative is led by a CEO Advisory Group comprising each leader of BHP, Anglo American, Gold Fields, Caterpillar, Komatsu and Sandvik, several members of which spoke today at IMARC Online about the collaborative model.

Nick Holland, Chief Executive, Gold Fields (and Chair of the CEO Advisory Group), said there was a critical need to advance work on cleaner, safer vehicles in mining, which will have important health and safety benefits and contribute towards the pressing need of decarbonising the mining industry.

“It is recognised that there are measures we can implement now, but other, more impactful, interventions are reliant on technology pathways that are still evolving,” he said. “This will undoubtedly take time, but the industry’s collaboration with OEMs, through the ICMM, is critical as we look for these long-term, sustainable and integrated solutions.”

Mike Henry, Chief Executive, BHP, added: “Safer, cleaner mining equipment is important for our people and the world. No one party can tackle this on their own though. The ICSV initiative brings together equipment manufacturers and ICMM members to accelerate the innovations required to improve equipment safety and reduce emissions. This is a great example of the collaborative industry-level effort that can help bring about the scale and pace of change that is needed.”

Denise Johnson, Group President, Caterpillar, said the OEM was committed to helping customers operate safely and sustainably, with the ICSV initiative helping it collaborate even more closely with the mining industry in these important areas.

“Its progress to date has helped to form a shared understanding of where the industry is on its journey and demonstrates that by working together we can more quickly accelerate the pace of change,” she said of the initiative.

Tom Butler, CEO, ICMM, added: “Partnership and collaboration fuels long-term sustainable development, and is crucial to addressing some of the mining industry’s biggest sustainability challenges. Progress made on the ICSV initiative has been building the widespread confidence needed to accelerate the level of innovation investment required to scale up commercial solutions. The initiative will benefit the entire industry and is open to all OEMs who would like to join.”

ICMM has developed tools to support the industry, OEMs and third-party technology providers to meet the initiative’s ambitions, it said. These tools include an ICSV Knowledge Hub that, the ICMM says, facilitates knowledge sharing of industry innovations, provides technical and practical resources including case studies, standards, regulations and a technology and solutions database.

Additionally, a set of “maturity frameworks” that help to “map, motivate and measure” progress against the ambitions have been published, with the intention to stimulate conversations within companies that drive thinking, decision making and action, it added.

In 2021, ICMM’s company members will focus on integrating the initiative’s goals into their corporate planning processes, allocating internal resources and effectively leveraging external resources such as synergies with other industry initiatives and collaboration between member companies, the ICMM said.

BHP and China Baowu take on steel industry GHG emission reduction challenge

BHP has signed a memorandum of understanding (MoU) with leading steel producer, China Baowu, with the intention, it says, to invest up to $35 million and share technical knowledge to help address the challenge of reducing greenhouse gas emissions facing the global steel industry.

The five-year partnership will focus on the development of low carbon technologies and pathways capable of emission intensity reduction in integrated steelmaking, according to BHP. Under the MoU, the deployment of carbon capture, utilisation and storage in the steel sector will also be investigated at one of China Baowu’s production bases.

BHP’s investment will be funded under the $400 million Climate Investment Program, set up last year to coordinate and prioritise projects, partnerships, R&D and venture investments to reduce Scope 1, 2 and 3 emissions, offsets and support development of technologies with the highest potential to impact change.

BHP Chief Executive Officer, Mike Henry (pictured left), said the companies would collaborate on technical solutions to use low carbon fuel sources such as hydrogen injection in the blast furnace, and explore other low emission options in support of China Baowu and the steel industry’s low carbon transformation and green development goals.

“This MoU further strengthens our longstanding relationship with China Baowu and reflects our joint determination and commitment to help reduce emissions in line with the Paris Agreement goals,” Henry said.

“BHP will invest in supporting the development of low emissions technologies, promote product stewardship and partner with others to enhance the global policy and market response to climate change. Our investments are focused on actions that can create real change in emissions.”

In September, BHP awarded a tender for world’s first LNG-fuelled Newcastlemax bulk carrier to carry iron ore between Western Australia and China, which will reduce emissions by more than 30% per voyage.

In October 2019, China Baowu, meanwhile, announced the establishment of a Low Carbon Metallurgy Innovation Centre and plans to establish a Global Low Carbon Metallurgy Innovation Alliance.

China Baowu Chairman, Chen Derong, said the MoU with BHP will further enhance and broaden the existing strategic partnership between the companies, and establish a model of joint industrial efforts to promote technological innovation and a sustainable transition to a lower carbon world.

“At the UN General Assembly, President Xi Jinping delivered an important speech that outlined China’s low carbon transformation and development,” Chen Derong said. “Low carbon transition and green development represent a major disruption to the traditional steelmaking value chain.

“As a leading company in the sector, China Baowu will take an active role in implementing low carbon technologies, working together with upstream and downstream partners.

“The global steel industry needs an open platform to jointly explore low carbon technology and roadmaps, as well as showcase to the world the efforts to reshape the steelmaking value chain.”

Consistent with the ambitions of China Baowu and BHP to drive efficiency and address emissions across the global steel industry, both companies will work together to establish a China Baowu-BHP Low Carbon Metallurgy Knowledge Sharing Center, to link complementary research and share low carbon and green development knowledge with domestic and international steel industry stakeholders, the two companies said.

BHP weighs trolley assist and IPCC as part of decarbonisation efforts

BHP has provided an update on its progress on climate action, new climate commitments and how it integrates climate change into corporate strategy and portfolio decisions in a new report.

The company’s climate change approach focuses on reducing operational greenhouse gas emissions, investing in low emissions technologies, promoting product stewardship, managing climate-related risk and opportunity, and partnering with others to enhance the global policy and market response, it says.

“BHP supports the aim of the Paris Agreement to limit global warming to well below 2°C above pre-industrial levels, and pursue efforts to limit warming to 1.5°C,” the company clarified.

It explained: “BHP has been active in addressing climate risks for more than two decades, and has already established its long-term goal of achieving net zero operational (Scope 1 and 2) emissions by 2050 and its short-term target of maintaining operational emissions at or below financial year (FY) 2017 levels by FY2022, using carbon offsets as required.”

In the past year, BHP has made progress on this aim, announcing that the Escondida and Spence copper mines in Chile will move to 100% renewable energy by the mid-2020s, and, last week, awarding new renewable energy contracts for its Queensland coal assets, and the world’s first LNG-fuelled Newcastlemax bulk carrier tender.

BHP’s climate change briefing and 2020 climate change report outline how the company will accelerate its own actions and help others to do the same, it said. Today’s update sets out:

  • A medium-term target to reduce operational greenhouse gas emissions by at least 30% from adjusted FY2020 levels by FY2030;
  • Scope 3 actions to contribute to decarbonisation in its value chain. This includes supporting the steelmaking industry to develop technologies and pathways capable of 30% emissions intensity reduction with widespread adoption expected post-2030 and, in terms of transportation, supporting emissions intensity reduction of 40% in BHP-chartered shipping of products;
  • Strengthened linking of executive remuneration to delivery of BHP’s climate plan; and
  • Insight into the performance of BHP’s portfolio in a transition to a 1.5°C scenario.

The report also outlined some examples of emission reduction projects the miner is considering, which will be weighed as part of the maintenance capital category of its capital allocation framework. This includes solar power installations; alternative material movement technologies such as overland conveyors and in-pit crush and convey solutions; and trolley assist to displace diesel for haul trucks.

The company expanded on this in its report: “The path to electrification of mining equipment will likely include solutions such as trolley assist, in-pit crush and convey, overland conveyors and battery solutions.

“Diesel displacement represents a higher risk, higher capital step towards decarbonisation, so a phased approach to execution is proposed with particular emphasis on Minerals Americas-operated assets that are further advanced on the decarbonisation journey. Taking a transitional approach to electrification provides flexibility to allow for the potential for rapid development of emerging technologies and to resolve the complexities of integrating these technologies into existing operations.

“During FY2021, we will seek to collaborate further with International Council on Mining and Metals members, industry and original equipment manufacturers to progress research and development to reduce costs and assess any potential impacts from electrified mining equipment solutions to replace current diesel options.”

BHP Chief Executive Officer, Mike Henry, said of the report: “I’m pleased today to show how we are accelerating our own actions and helping others to do the same in addressing climate change. We see ourselves as accountable to take action. We recognise that our investors, our people and the communities and nations who host our operations or buy our products have increasing expectations of us – and are responsive to these.

“Our approach to climate change is defined by a number of key requirements. Our actions must be of substance. They must be real, tangible actions to drive emissions down. We must focus on what we can control inside our business, and work with others to help them reduce emissions from the things that they control. To create long-term value and returns over generations, we must continue to generate value and returns within the strong portfolio we have today, while shaping our portfolio over time to benefit from the megatrends playing out in the world including decarbonisation and electrification.

“Our portfolio is well positioned to support the transition to a lower carbon world aligned with the Paris Agreement. Our commodities are essential for global economic growth and the world’s ability to transition to and thrive in a low carbon future. Climate change action makes good economic sense for BHP and enables us to create further value.”

BHP supports local suppliers with reduced payment terms

As part of its response to the spread of COVID-19, BHP says it is accelerating payment of outstanding invoices and the reduction of payment terms for its small business partners and regional communities.

This support will see payment terms cut from 30 days to seven days for more than 1,100 small Australian businesses from next week, it said.

The accelerated payment program is expected to deliver around A$100 million ($57 million) more quickly into the hands of its small business partners, the company said. In this context, a small business is defined as generating less than A$10 million in revenue.

BHP CEO, Mike Henry, said looking after the wellbeing and safety of its people, communities and partners is the highest priority.

“We are taking action to reduce the risk of transmission at our sites, in our offices and in our communities. Our local and small business partners play a critical role in supporting our operations and our people, and we know this is a very difficult time for them. We must look out for each other as we manage through this together,” Henry said.

BHP has also created a A$6 million fund to support its labour hire companies and their employees. The fund will be used for one-off payments for people quarantined after entering Australia and pay for labour hire employees not entitled to sick leave but affected by COVID-19, it said.

The miner said operations at its sites continue with additional monitoring and procedures in place to reduce the risk of COVID-19 transmission among its workforce, clarifying that, as things currently stand, there have been no material impacts on its operations or supply chain.

Mike Henry to ‘unlock even greater value’ from orebodies as new BHP CEO

The Board of BHP has announced that Mike Henry has been appointed Chief Executive Officer and Executive Director of BHP, effective January 1, replacing Andrew Mackenzie who will retire on December 31.

Henry has 30 years’ experience in the global mining and petroleum industry, spanning operational, commercial, safety, technology and marketing roles, according to BHP. He was appointed to his current role of President Operations Minerals Australia in 2016, and has been a member of the Executive Leadership Team since 2011.

He joined BHP in 2003, initially in business development and then in marketing and trading of a range of mineral and petroleum commodities based in The Hague, where he was also accountable for BHP’s ocean freight operations. He went on to hold various positions in the company, including President Coal, President HSE, Marketing and Technology, and Chief Marketing Officer. Prior to joining BHP, Henry worked in the resources industry in Canada, Japan and Australia.

Chairman, Ken MacKenzie, said: “Mike Henry’s deep operational and commercial experience, developed in a global career spanning the Americas, Europe, Asia and Australia, is the perfect mix for our next CEO. I am confident his discipline and focus will deliver a culture of high performance and returns for BHP. Mike has been a strong advocate for the industry, driving higher standards of safety and a commitment to our local communities and global stakeholders.

“We would like to recognise the outstanding contribution of Andrew Mackenzie to BHP as CEO. Under his leadership, BHP has transformed into a simpler and more productive company, financially strong and sharply focused on value for shareholders. We thank him for his vision and hard work, which has changed the way we operate and engage with the world.”

Outgoing CEO, Andrew Mackenzie, said: “It has been a privilege to serve as CEO of BHP. Our products are essential to global economic development and we deliver them in a way that creates significant value, for our shareholders, our employees, communities, nations and the world. BHP is in a good position. We have a simple portfolio, a strong balance sheet and options to grow value and returns for decades to come.

“Fresh leadership will deliver an acceleration in the enormous potential for value and returns that will come from BHP’s next wave of transformation. Choosing the right time to retire has not been an easy decision, however the company is in a good position. I am confident Mike and BHP will seize the many opportunities that lie ahead.”

CEO-Elect, Mike Henry, said: “I am honoured and privileged to be appointed as CEO and to have the opportunity to lead the talented and hard-working people who make BHP a great company. For more than 130 years, through the ingenuity and commitment of its people, BHP has delivered shareholder value while successfully adapting its portfolio, operations and products. Today we are even safer, more predictable and more focused.

“We will unlock even greater value from our orebodies and petroleum basins by enabling our people with the capability, data and technology to innovate and improve. We must operate safely, with discipline and reduce our impact on the environment. With the right people and the right culture we will deliver value and strong returns for shareholders and for all of society.”