BHP has secured a $40 million agreement to explore copper projects in Botswana, potentially acquiring a 75% stake in Kitlanya East and West. This partnership with Cobre aims to uncover valuable copper-silver deposits in the Kalahari Copper Belt. The initiative is part of BHP’s strategy to shift focus toward copper in anticipation of declines in iron ore production.
Australian mining giant BHP has announced a $40 million earn-in agreement to fund two copper projects in Botswana: Kitlanya East and Kitlanya West. This venture allows BHP to potentially acquire a 75% stake in these high-potential projects located in the Kalahari Copper Belt, leaving the ASX-listed Cobre with a 25% stake. Armed with substantial financial backing, BHP aims to enhance its copper exploration efforts in Africa.
Cobre’s CEO, Adam Wooldridge, emphasized that this partnership is a significant milestone for the junior explorer. He believes that the Kitlanya projects may contain valuable tier-1 deposits, and the collaboration will provide the necessary funding and technical support to advance the exploration work.
The Kalahari Copper Belt, spanning approximately 1,000 km, is home to several mining operations, including the nearby Motheo Mine operated by Sandfire Resources. BHP’s exploration officer, Tim O’Connor, expressed enthusiasm for the opportunities in Botswana, noting that the Kitlanya projects could unveil important copper-silver deposits due to BHP’s expertise and resources.
Cobre has initiated a seismic survey at Kitlanya West, with further exploration set to begin in April. BHP will also provide Cobre with an additional $15 million based on future copper content, guided by a Joint Ore Reserves Committee (JORC) report. JORC reports are essential for evaluating the potential value of mineral projects and ensuring transparency for investors.
BHP is actively repositioning its commodity portfolio to increase its copper holdings in response to potential declines in iron ore, its main source of earnings. The company previously attempted a $75 billion takeover of Anglo American, largely motivated by its copper assets. In South Australia, BHP continues to establish a copper province by connecting its Olympic Dam mine with the Prominent Hill and Carrapateena mines following its acquisition of Oz Minerals.
The increasing demand for copper, driven by emerging AI and green technology industries, presents supply challenges. BHP’s CEO, Mike Henry, highlighted the necessity for approximately $386 billion in growth capital to satisfy global renewable energy goals, indicating that current committed projects fall significantly short of this target.
BHP’s move to fund copper projects in Botswana reflects its strategic focus on expanding its copper portfolio amid projected declines in iron ore markets. The partnership with Cobre is pivotal, enabling enhanced exploration and potential discovery of valuable mineral deposits. As the demand for copper rises within the energy sector, BHP’s investment highlights the urgency for new projects to meet global energy transition goals.
Original Source: www.news.com.au
