Olympic Dam
The expansion of the Olympic Dam copper mine has been approved but the next step in BHP’s Copper strategy is a new and environmentally friendly approach to produce sustainable or ‘green’ copper.
SOUTH Australia has a solid strategy in place for copper growth in the state.
Firstly, to accelerate exploration and discovery; secondly to develop innovative infrastructure, services and research; and thirdly, engage to build industry and community capacity.
BHP’s Olympic Dam is certainly reaping the benefits of the first step, with South Australia approving its expansion plans in February of this year.
The $3b proposal would increase Olympic Dam’s annual copper production from 200,000t to up to 350,000t and increase the level of gold, silver and uranium production.
SA Energy and Mining Minister Dan van Holst Pellekaan declared BHP’s proposed expansion of Olympic Dam a major development as a key milestone in this important project.
“Olympic Dam is already the State’s largest mining operation, providing jobs, investment and royalties for South Australia,” he said.
“BHP’s proposal could potentially create up to 1800 construction jobs with an additional 600 ongoing positions in operational roles.”
There are a few stringent environmental and biodiversity hurdles to leap, but BHP said there would be a comprehensive state and federal process that would include assessment of the potential for social, economic and environmental impacts associated with an increase in mining and production at Olympic Dam.
Olympic Dam asset president Laura Tyler said that BHP was aiming to achieve stable operations and sustainable growth at Olympic Dam through a staged and capital-efficient long-term approach.
“Olympic Dam is a world-class resource with the potential to deliver value to BHP and South Australia for many decades to come, especially given our positive outlook for global copper demand,” she said.
“We are pleased the South Australian Government has declared Olympic Dam’s growth plans a major development, recognising our significance to the state.
“Our team continues to refine the scope for targeted underground development in the Southern Mine Area, strategic investment surface processing facilities, new technology and supporting infrastructure.”
In its latest operational review, copper production at Olympic Dam increased by 17pc to 160kt as a result of the major smelter maintenance campaign in the prior period, which was partially offset by an unplanned acid plant outage in August 2018, and two minor production outages in May 2019 relating to the smelter and to the refinery crane.
Production is expected to increase to between 180kt and 205kt in the 2020 financial year, reflecting improved operational performance, partially offset by planned maintenance related to the replacement of the refinery crane (pre-work scheduled for the September 2019 quarter, and physical replacement and commissioning scheduled for the March 2020 quarter).
“We are confronted by a fast growing and copper hungry world.”
“During the 2019 financial year, we successfully completed the heap leach research and development trial, confirming the viability of the technology to extract copper, uranium, gold and silver at Olympic Dam,” the report stated.
Sustainable focus
Since early this year, BHP has been pushing its message of environmentally friendly operations to address climate change, and it’s keen to show consumers that its copper operations like Olympic Dam can jump on the sustainability bandwagon.
At the International Wrought Copper Council in Chile in April, BHP president of operations – minerals Americas, Danny Malchuk, elaborated on the company’s new strategy for sustainable copper operations.
“The case is clear: society demands a rapid transition to low emissions technologies to combat climate change,” Mr Malchuk said.
“These facts are critical when it comes to the demand for copper.
“A battery powered electric vehicle contains four times as much copper as a conventional medium sized car.
“We are confronted by a fast growing and copper hungry world.”
However, Mr Malchuk cautioned that high-quality copper is becoming harder to find and extract.
“As grades decrease, strip ratios rise and deposits get deeper, more water and energy is required for the same amount of output,” he said.
“If the current trend continues, the OECD suggests that by 2060, copper will have a substantially worse environmental footprint, both compared to today and to many other metals, on a per tonne basis.
“A low carbon future is materially intensive in minerals like lithium, cobalt and copper.
“If these supply chains are not properly managed, it could seriously undermine the efforts of producing countries to meet their climate and related Sustainable Development Goals.”
Mr Malchuk said BHP was always looking for ways to improve.
“If we are to follow other industries in to a more sustainable future, we must work together,” he said.
“This will become even more important as we are confronted by new challenges shaping the sector.
“Consumers care and they speak with their wallets.
“Investors do the same and the rising influence of ESG investors ensures that our sectors’ performance and transparency must keep up with their demands.
“And although sustainability should not be driven by profits, higher price premiums for sustainable commodities could be the wake-up call we need as an industry and provide an incentive to invest more on sustainable solutions.”
Both the International Copper Association (ICA) and the LME have led initiatives to drive greater transparency and lift sustainable credentials across the copper value chain.
“A thorough solution will involve us all, but what I am calling for today is a new set of principles to guide the copper industry of the future,” Mr Malchuk said.
“Firstly, we need an increased level of transparency across our value chains.
“The benefits of higher transparency will be clear as consumers can easily identify sustainable copper, just as they do with a 5-star energy rating on a kitchen appliance.”
Collaboration was also mentioned across the entire value chain from end to end.
“Apple has been outstanding in sharing their standards with cobalt smelters,” Mr Malchuk said.
“Whether you are an explorer, a miner, or a fabricator, we will be better if we confront it collaboratively.”