BHP chief Mike Henry sets aggressive timetable for emissions reduction
BHP chief commits to a 30pc cut in carbon emissions over the next decade to hit net zero in operations by 2050.
BHP chief Mike Henry is committed to a 30 per cent cut in carbon emissions over the next decade on the way to be net zero in operations by 2050.
In a presentation on Thursday, Mr Henry stepped up the campaign started by his predecessor Andrew Mackenzie by laying down an aggressive timetable for emissions reduction, while also highlighting the value drivers for BHP.
Under a low emission environment the world will need to use 3.7 times as much nickel, 2.3 times as much potash, twice as much copper and 1.8 times as much iron ore, Mr Henry said.
The BHP targets compare with the self-proclaimed industry leader, Fortescue Metals Group (FMG) which said earlier this year it would cut emissions by 26 per cent in the next decade and by zero net neutral by 2040.
The BHP “building a better world” presentation came amid market chatter that Rio Tinto was poised to swing the axe under shareholder pressure for its Juukan Gorge tragedy, where it blew up a 46,000 year old heritage area.
One miner noted the gorge aside, the resources industry is a relatively strong employer of Indigenous people compared with the superannuation funds who have minuscule representation.
BHP is linking executive pay to its progress on emissions reductions with 10 per cent of bonuses linked to carbon performance.
In his presentation Mr Henry said: “In the past year, BHP has made good progress. The Escondida and Spence copper mines in Chile will move to 100 per cent renewable energy by the mid-2020s, and last week BHP awarded new renewable energy contracts for its eastern Australia coal operations, and the world’s first LNG-fuelled Newcastlemax bulk carrier tender.
“Our approach to climate change is defined by a number of key requirements. Our actions must be of substance,” he added.
“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.”
Mr Henry said “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 outcomes.”
“Social value is an essential precondition to shareholder value,” he said.
BHP is committed to 30 per cent emissions reduction in so-called scope one and two emissions which are actions it can control.
On scope three emissions that are in its customers’ control, Mr Henry said BHP was working with customers to support the introduction of technology capable of cutting emissions by 30 per cent.
It is also cutting shipping emissions by converting to LNG powered vessels from the traditional oil powered ships.
BHP is the biggest dry bulk freighter in the world.
It will achieve its short-term reductions through a range of actions, including converting its truck fleet to electricity powered vehicles and more efficient diesel power.
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