Major development projects
At the end of March 2021, BHP had four major projects under development in petroleum, iron ore and potash, with a combined budget of US$8.5 billion over
the life of the projects. Our major projects under development are tracking to plan.
In March 2021, the US Department of Agriculture directed the US
Forest Service to rescind the Resolution Copper Mining (RCM) projects Final Environmental Impact Statement and the draft Record of Decision that were both issued in January 2021. BHP supports RCMs collaboration with the US Forest
Service, and its commitment to further consultation with local communities and Native American tribes in an effort to seek consent, as it continues to study the project.
The Jansen Stage 1 project in Canada is expected to be presented to the BHP Board for Final Investment Decision in the middle of the 2021 calendar year.
Corporate update
On 9 April 2021, Samarco
announced that it filed for judicial reorganisation (JR) with the Commercial Courts of Belo Horizonte, State of Minas Gerais, Brazil. The request for JR was granted by the Belo Horizonte Justice on 12 April 2021. The JR is a means for Samarco
to restructure its financial debts in order to establish a sustainable independent financial position for Samarco to continue to rebuild its operations safely and meet its Renova Foundation obligations. Samarcos filing follows unsuccessful
attempts to negotiate a debt restructure with financial creditors and multiple legal actions filed by those creditors which threaten Samarcos operations. Samarcos operations will continue during the JR and restructure process. The JR
does not affect Samarcos obligation or commitment to make full redress for the 2015 Fundão dam failure, and it does not impact Renova Foundations ability to undertake that remediation and compensation.
In February 2021, we signed a memorandum of understanding (MOU) with a large Japanese steel producer, JFE, to jointly study technologies and pathways capable
of making material reductions to greenhouse gas emissions from the integrated steelmaking process. We have agreed to invest up to US$15 million over the five-year partnership.
In March 2021, we also signed a MOU with Chinas HBIS Group Co., Ltd (HBIS), one of the worlds largest steelmakers and one of our major customers
of iron ore, with the intention to invest up to US$15 million over three years to jointly study and explore greenhouse gas emissions reduction technologies and pathways. The three-year partnership intends 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 utilisation to help reduce emissions from ironmaking and steelmaking.
The partnerships with JFE and HBIS follow other investments to support the reduction of value chain emissions, including up to US$35 million for the
collaboration with Chinas largest steelmaker, China Baowu (November 2020), awarding our first LNG-fuelled Newcastlemax bulk carriers contract (September 2020), with the aim to reduce
CO2-e emissions by 30 per cent per voyage and a successfully completed marine biofuel trial which enables us to develop an informed strategy on the structural supply and use of biofuels to
support our key shipping routes (April 2021). The advanced biofuel reduces CO2-e emissions by 80 to 90 per cent well-to-exhaust compared with heavy fuel oil (HFO)
and very-low sulphur fuel oil (VLSFO), and uses sustainable waste and residue streams as feedstock.
In February
2021, we also executed a 10-year PPA contract with Merredin Solar Farm to supply up to 50 per cent of the Nickel West Kwinana Refinery electricity needs by 2024, based on 2020 financial year levels. This
contract will further increase the sustainability of the nickel produced by Nickel West and will help to reduce emissions from electricity at the refinery by up to 50 per cent.
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BHP Operational Review for the nine months ended 31 March 2021
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