The chief executive of BHP, Mike Henry, has secured a meeting with former President Donald Trump, alongside Rio Tinto executives, to advocate for their joint venture copper mine in Arizona. This meeting in the Oval Office comes in the wake of a U.S. appeals court’s decision to temporarily block the Trump administration from transferring a sacred tribal site, Oak Flat, to Resolution Copper, a move that has significant implications for the project.
Copper remains a strategic focus for BHP, Australia’s largest miner. Despite the legal setback, Henry expressed confidence in the project’s eventual success. “Not quite clear on that [timing], but both Rio and ourselves are really ready to go and want to get activity underway on the ground,” he stated. He emphasized the project’s potential to generate thousands of jobs and billions in economic activity across the United States.
Trump’s Support and Legal Challenges
Following the court’s decision, Donald Trump took to his social media platform to voice his support for the copper project, stating, “A Copper Mine in Arizona, ‘Resolution,’ was just delayed by a Radical Left Court for two months. 3,800 Jobs are affected, and our Country, quite simply, needs Copper—AND NOW!” This backing highlights the administration’s broader agenda of reducing environmental and cultural protections to bolster mining activities.
Both BHP and Rio Tinto have long-standing policies for Indigenous and cultural heritage protection. “The administration has been supportive of mining, but let’s keep in mind here that both companies have very strong internal policies when it comes to both Indigenous, cultural heritage protection,” Henry explained. He noted that the project has been in development for two decades, with over a decade of consultations.
BHP’s Global Strategy and Economic Outlook
While the Trump administration’s tariffs have limited direct impact on BHP, the company’s largest customer, China, remains a focal point. Henry expressed cautious optimism about China’s economic growth, which is crucial for commodity pricing. “Expectations [are] widely held that they’ll achieve their 5 percent [growth] ambition for the year,” he noted, adding that this has supported healthy financial results, including a 60-cent dividend for the half-year.
Despite a decline in iron ore value, BHP continues to focus on its copper growth options. “One of the great things that we’ve managed to achieve over recent years is the development or the progressing of four big copper growth options,” Henry said, emphasizing the company’s strategic flexibility.
Global Competition and Australia’s Position
Henry warned of increasing global competition for capital, with countries like the U.S. and Argentina actively attracting investment in mining and manufacturing. “There’s been particularly strong focus on urgently attracting more investment [in the US], including manufacturing and basic industries like mining,” he observed, noting similar efforts in Argentina and Canada.
Australia, an export-reliant nation, faces challenges in maintaining its competitive edge. Henry highlighted the need for efficient regulations and affordable electricity to attract large-scale projects. “Australia is an export-reliant nation … some of the stalwarts of our current exports are going to face headwinds in the coming years,” he stated.
Financial Performance and Future Prospects
This week, BHP, the country’s largest miner, reported a hit to its full-year profit due to weaker prices in iron ore, coal, and copper. The statutory profit was $US9.02 billion, up 14 percent from the previous year, but the underlying result was the lowest in five years, with revenue down by 8 percent. Despite this, the company increased its dividend payout ratio to 60 percent, rewarding shareholders with a total dividend of $US1.10 for the full year.
As BHP navigates these challenges, its disciplined approach to acquisitions and focus on organic growth options continue to be at the forefront of its strategy. “We’re not reliant upon any of them individually. We’ve got multiple organic growth options and that’s really where management’s focus is,” Henry concluded.
