Geraldine Slattery, President Australia BHP, Melbourne Mining Club, 5 December 2024

Thank you for those very kind words of introduction, and thank you for the opportunity to be here today. I'd like to start by echoing Sally's respects to the traditional owners of the lands on which we meet here today, and indeed to the traditional owners of the many lands on which BHP operates. I'd also like to acknowledge His Excellency Valiano Gallardo, Ambassador of Peru to Australia, and also the Consul General of Chile, Mrs. N. Bernel, and indeed all distinguished guests. I'd also like to acknowledge the Melbourne Mining Club Chair Sally Cox, co-patrons Lee Clifford and Hugh Morgan, and indeed the full committee. I congratulate you on another terrific year. Also, a special shout out to Gavin Cery for your very admirable and incredible contribution, as we just heard, over the past 23 years. And of course, a big thank you here to everyone for supporting the Melbourne Mining Club. I'm incredibly proud to be a part of this great industry, and as you heard there in the remarks, I'm also a big fan of the AFLW since I came back to Australia. And so I was thrilled just last week to attend the annual W Awards and joined Tia Toes and Zoe Waker. Now, in case you're not an AFLW fan, Tia is a former player for the Fremantle Dockers, and Zoe is a current player for the West Coast Eagles, and both are part of Team BHP here in Australia. Now, after the event, I thought what the resources sector could learn from AFLW. Since launching in 2017, the competition has grown from eight to 18 teams and tripled the number of games played in a single season. And even with all that, the AFLW is still hungry, still wants to keep growing. I thought about this, that hunger to grow, that focus on partnerships, and the approach to collective enterprise. It's these same ingredients that have enabled our resources sector to succeed for generations. Over many decades, we have enjoyed a competitive advantage based on Australia's natural resources, our deep mining experience, and our ability to develop at scale through multiple economic cycles. We have proven the enduring value of our industry. We've shown resilience as the external environment shifts. We've demonstrated how indispensable we are to Australia's prosperity. Consider this: as a sector, we've paid over $350 billion in company tax and royalties over the past 10 years. That's essentially the same as paying for 10 years of Medicare. So where to from here? Today we find ourselves in the energy transition, one of the great industrial shifts in history. All of us here know that that shift will not occur without the minerals that Australia provides. Amid this global realignment, Australia must avoid the trap of taking our history for granted. We recognize that the playing field has shifted. Yes, the opportunity is great, and we see it, but the stakes are even greater. And so today I want to talk about the opportunity for our sector and for Australia to embrace a more competitive mindset, one that relentlessly pursues a better future, and a mindset that holds every policy debate, every reform proposal up to the light and considers: does this make Australia more competitive? Because we all know that Australia does not have the same natural advantages as we do with our iron ore and coal when we look forward, and our challenges go beyond the nature of our resources. So to offer a perhaps blunt assessment: our access to skills and talent is under threat. Our investments in technology and innovation trail some of our biggest competitors, and we're not keeping pace as an attractive place to invest. Now, while this is not likely news to any of you here, there is an element of acknowledging this shift and responding, and we must be championing enabling more competitive settings. We can't change the rocks we have, but we can certainly change and influence the enablers and the settings that govern their discovery, their extraction, and their development. If the sector, government, and investors work together, the opportunity is immense for the sector and for Australia, and I have complete confidence that we can compete and we can succeed. So how do you do this in practical terms? Let me offer a couple of thoughts. One, by focusing on building the workforce with the right skills. Two, by embracing technology that will shape the future. And three, by championing a policy of competitiveness. Let's start with the skills, building the skills of our people. The demographics of the Australian mining industry are rapidly changing. The sector is facing structural challenges in skilled labor sufficiency. On the supply side, the threat is equal. Nearly 50% of the skilled engineering workforce will retire in the next decade, and we know that we don't have enough graduates coming into the mining-related fields to replace those that are retiring. Now, this is not a question of reward. Australian mining not only provides the highest paid jobs of all sectors domestically, but Australian mining jobs are actually higher paid than the equivalent roles in Canada and in the US. Part of the solution lies in expanding Australia's workforce participation, and this highlights the fundamental importance of the entire industry's work to build a more diverse and a more inclusive workforce. As you likely know, BHP has progressively increased gender diversity, and women now make up over 37% of our employee base globally. That's a figure that's more than doubled since we set our gender balance aspiration back in 2016. Now, this has not happened by chance. It's taken investment in education and in training pathways. It's taken policies to level the playing field in equity and in caring responsibilities, and it's taken working with regional communities to solve childcare availability, and also a continued conviction in making our culture more inclusive. Now, we all have a role to play here, and the government's efforts to expand fee-free TAFE places are commendable. I'm also heartened by the table of students who the Melbourne Mining Club are hosting here today. I look forward to meeting you. I'm certain that you are the future leaders of our industry. Now, for our part, in 2020, BHP launched the Future Fit program in Perth and Mackay, and to date, more than 1,300 people have benefited from this initiative with guaranteed jobs on completion of bespoke training. This is Australia's next wave of mining technicians and tradespeople. Most of them are new to industry, female, or indigenous. So continuing to bring these new talent sources into our workforce must be treated as part of the national competitiveness agenda and policy. Now to turn to technology. The race is on to find and develop mineral resources around the globe. In this context, the federal government's commitment of over half a billion dollars through Geoscience Australia to survey Australia's critical minerals is timely and indeed welcome. There is, I believe, a shared recognition that in mining, next-generation technologies will make our exploration, our development, and our operations safer, more sustainable, and more productive. And on that, I do know many partners in this room who are doing just that, including in renewable energy, in electric smelter-free steelmaking, in research, and in decarbonization. But when we stand back and look at how well is Australia positioned overall, Australia currently ranks 23rd in the Global Innovation Index, trailing Canada, the US, China, and much of the EU. Australia is ranked 20th in the world in our readiness to adopt and explore digital technologies. And while research and development investment as a share of GDP is growing rapidly across the OECD, in Australia it's actually slowing down. I'm hopeful that the government's research and development review announced this week and led by Robyn Denholm will find ways to reinvigorate our R&D progress. As we know, the artificial intelligence boom is a mining boom too, and if we needed any clearer reminder of the potential of AI, in the last year alone, Microsoft and Nvidia joined Apple in the $3 trillion club. So as markets and societies begin to grasp the power and potential for artificial intelligence and how it will shape all of our futures, our industry can, is, and should provide leadership in technology, and artificial intelligence will improve, undoubtedly, Australia's competitiveness. Finally, on policy, we must champion a more competitive Australia through our policy settings in the way we grant permits, regulate mining, and manage risk. It starts with streamlining permits, making it easier to develop major projects and bring them to market. Here in Australia, we're incredibly proud of the high standards that the industry upholds, but we need to be smarter and we need to do it more efficiently. Time to market matters. In 2020, the Samuel review found that on average, complex resource sector projects take on average over a thousand days to assess and to approve. Of course, inefficient regulation just translates into project delays and uncertainty. Now, governments are figuring this out globally. The US introduced an Energy Permitting Reform Act this year, and the incoming Trump administration is continuing the conversation and the focus on permitting. Canada has created a federal permitting coordinator and amended its Impact Assessment Act to accelerate decisions. In Chile, the need for a better permitting system is now recognized across the Congress, and the government has made it a focus of its legislative agenda. For Australia, the principles should be clear: put in place a risk-based permitting system that ensures processing timelines are certain and the outcomes are reliable. In short, we must modernize our permitting system in line with the changing nature of competition. Now, today I focused on permitting, but of course, I want to reiterate that tax settings are equally as relevant as our labor laws. It remains our view that the industrial relations changes of the past two years will raise costs, reduce productivity, and take us backwards in our ability to compete globally. While this is my first time at the Melbourne Mining Club, it's also the last day of the year, or the last meeting rather of the year, a few weeks to go yet. So to conclude, I want to first acknowledge and thank everyone here for another year of bringing new skills, new thinking, and technology to our industry and making it a better place for our people, but also for the communities where we operate. I'm incredibly proud to be a part of this industry. All of us in this room have seen firsthand the difference that it makes. We're doing great things, but I believe, and I hope you will join me in continuing to advocate for the sector to move faster, work harder to improve our competitiveness. I hope that 2025 brings us all out as advocates and continue to advocate and push for Australia's competitiveness globally. So thank you very much for your attention.

Thanks, Christy. What a relevant question. Look, I think we all get it in this room, but I think it's fair to say that if you're not close to the sector, if you don't see firsthand what it takes to bring the sector to life and the decisions, the capital, and the vision over 50 years or more, then it can be difficult to see that, and particularly in a world where news cycles kind of run in maybe social media type timings. I think here in Australia, it's an incredibly important point to raise because not only is it integral to our way of life, it's also integral to our economy and to our livelihoods. We know that 30% of our exports come from the resources sector. The top 20 corporate taxpayers in Australia is in the resources sector. So what underpins our healthcare, our education system, our way of living comes from the resources sector. So I think it's incumbent on many of us here, but more broadly, to speak to the richness we have and what it takes to see that continue. So a very live conversation.

So early days, of course, and if we step back from the recent election maybe just for a moment, I think, you know, we've seen the US on a bipartisan level recognizing the significance of mineral development, and that's come to life through a focus on derisking permitting and simplifying permitting, and also focused on increasing supply chain resilience. I think we'll see that continue. The remarks from the narrative so far from the incoming administration certainly reinforces that. So I think we can expect to see that. I think, but even though it is early days, I think the narrative also suggests a stronger focus on US domestic economy and US domestic supply chain resilience and development of critical minerals. How that will play out in terms of the sector more broadly, I think, remains to be seen. For us here in Australia, in the mining sector, our best defense really is to recognize the significance and the value of what we have, have the lowest cost, highest quality product, and be ready to compete and take on the opportunities or indeed the threats that might play out.

So I think we'll see 2024 close out with China reaching its own target of 5%. I think as we look into 2025, the same enduring themes that underpin its economy will continue to play out. We've seen housing be a drag, particularly on steel and iron ore. The most recent stimulus seems to have garnered a bit more optimistic sentiment in the market, and we're starting to see some green shoots. So possibly the housing sector has bottomed out in terms of its lag. But beyond steel and iron ore, of course, the sectors that call to, whether it's copper or other minerals in electric vehicles and infrastructure and manufacturing, that's been a source of endurance and strength. Back to your question on iron ore, I mean, in terms of the outlook, I think we've anticipated for and spoke publicly for some time that as China in particular reaches its kind of later stage urbanization, that we expect to see steel demand coming off, and indeed as scrap availability comes up. But you know, there's still a billion tons of steel demand a year, so whilst we expect that to moderate, it's still strong. And obviously the iron ore division is the powerhouse of BHP as a whole. I live in Perth, so I know how important it is. Every second person works or is connected to it somehow. So what's the outlook for that division, and you know, is there any sort of plans to keep growing? Sure. So we expect prices to moderate between now and the end of the decade as new supply impact comes into the market, as well as the declining demand for steel for many reasons. That recognition of a changing market has been core to the iron ore division in Western Australia, and thanks for your kind remarks about it. The team in WA will love that. So Western Australia iron ore is the lowest cost and most efficient iron ore miner globally and has held that position now for a couple of years. So, you know, outstanding performance from the team there. That provides us with the resilience through a changing market, and we really see the benefit of that in margins. In terms of growth, so we're growing modestly. We're 287 last year, kind of trending to 305 in 28. In terms of medium-term guidance, growth beyond that is certainly something we're studying, but has to compete for capital. Certainly the fundamentals of the asset is incredibly strong. We understand the market, but one of the reasons I, you know, we continue to talk about the competitive settings is because that flows directly into our ability to grow. So we recently sanctioned a sustaining mine, Western Ridge Crusher, just a few months ago, and as I said, continue to look at growth, but nothing decided past the 305.

So the Simandou project coming on and indeed some other sources of growth, again, I think ourselves and many of our peers, of course, would have recognized that, and that coupled with the moderating demand certainly does put a focus on the cost basis and the quality of the resource. Look, I think I'll go back to stating being the lowest cost producer positions us very well, and maintaining that position of resilience, I think, is just kind of fundamental to our ability to maintain the strength. I think the Pilbara, Western Australia, has really shown itself over decades to be incredibly resilient, both from the private sector but also the support of state government, has seen that play out.

Yeah, so we do have a lot of growth options for sure, and there is a lot of competition for capital. Part of the strategy at BHP centers on being in the right commodities, having great assets, and a capital allocation framework that drives that. Look, we're investing in copper, South Australia, now. In fact, we're investing in iron ore now. So there is competition for capital, but equally the attractiveness of those assets play through. So in copper, South Australia, of course, the acquisition of the Oz Minerals assets, the exploration success in Oak Dam, we're anticipating and planning for a world where we may be able to double the copper output over the course of the next 10 years. So got 13 rigs in exploration now, and actively looking at, yeah, how we can advance the studies for that. As I said, Western Australia, we continue to invest in sustaining the business as well. Autonomy, looking at the electrification, actually just this week, together with APA, very pleasingly announced solar and wind renewable energy to support the port operation. So there is strong competition for capital. I'm all about Team Australia, so getting the settings right, getting the labor force right, that's why that's so important.

So we did need to take that decision after much thought, and certainly for the very foreseeable future, the surplus that's in the market creates quite an overhang, and despite growing demand, that overhang we think will probably take us to the end of the decade. I don't, I wouldn't necessarily subscribe to the view that nickel is dead. I think if there's a supportive price environment, if there is an opportunity to reset the cost basis and the competitiveness through technology and, you know, a modernized supply chain or a value chain, I think that's certainly very, very plausible. But lots to see how that market plays out, both our ability to compete and how different market supply sources come on.

So we made a commitment as part of the moving into temporary suspension to work with our communities, with state government, and with our employee base, and part of that was to re-offer redeployment because talent, as I've spoken about, very difficult to come by. So yeah, very pleased to kind of share, was about 700 of our Nickel West colleagues heading to predominantly iron ore, but also to copper, Australia, across to Queensland, the metallurgical coal assets. So yeah, that's been good for our employees and it's been good for the company.

So the metallurgical coal business, we see a continued strong demand, and particularly from India. 40% of our coal goes to India, and you know, we make up a significant part of their imports. We've high-graded the portfolio to really concentrate our assets on the highest grade coal, because we think that's where ultimately there's more tightness in the market, and that the higher grade of coal contributes to a more energy-efficient steelmaking. We think the blast furnace will actually prevail for many years to come, notwithstanding the efforts, including between ourselves and some of our biggest steel customers, to advance the green steel and lower carbon steel. But certainly as we transition to that future, it's our view that metallurgical coal, and particularly the high grade, will be a core part of that.

Look, I think as I spoke about just there, there's many policy settings. The changes to the industrial relation laws that have taken place over the past couple of years, without a doubt, and this is not just BHP saying this, this is and not even the mining sector, it's broader than that, it's all of business, that the changes that have come in add costs, they impede productivity, and ultimately kind of are a drag on productivity and competitiveness. So the absolute wish list is to see those repealed or changed, and I think that's something that would be welcomed across business.

In Western Australia, look, I think the same kind of underpinnings are as relevant there as they are more broadly. But we have a good relationship, as the sector does more broadly, with the Western Australian government, and you know, the key to policymaking is the opportunity to have a constructive dialogue and engage in a design of policy settings that work for the sector and indeed work for the state and the country. Of course, we all have our different realities, but it's that relationship and the coming together that should inform the best policy settings.

So much of what I've talked about here. So the core business, the imperative for continued focus on safety and our people, that's really never far from my priorities, and the engagement with our indigenous traditional owner partners and with communities. I think beyond that, it is working with the sector and, you know, with policymakers to inform the settings that will allow Australia to compete for capital. So we've got some outstanding opportunities in copper, South Australia, in particular, but also in iron ore. And if we can arrive at the policy settings, work on investing in technology, both the private sector, of course, and, you know, great to see that review announced this week, I think that's my biggest focus because that's what will set us up for growth going forward.

So we deploy, and I'm sure many are here in the room, technology and digital technologies, predictive analytics, autonomy, increasingly AI, but early stages across the supply chain. I mean, it's an inherently repeatable and predictable process, and it's also incredibly data-rich. So 50-60% of our mines are now autonomous. The opportunity to go beyond, if you like, the 1.0 to the 2.0 of autonomy in terms of the smart mine, I think that's an area that offers opportunity. In safety, there's an enormous opportunity. We know that vehicle interaction between vehicles and people, that's where most of our injuries and tragically fatalities occur. So providing that, whether it's separation or detection, is an area. And you know, one of the other areas that we have deployed technology is either there in our exploration, both directly through the kind of bringing together of the geological data sets and data analytics to either move the pace or the insights, and also in our partnership with accelerators and startups who often are just a little bit more agile than companies in advancing technologies and trying new things.

So there's 32 Irish players in AFLW. It's, for anyone that follows it, you have a lot of Gaelic footballers that come across. So I've been following Geelong all year, and Aisling Maloney, he's a great goalie there. But yeah, I do switch between them depending where the players come from.

A great, great question, and certainly very topical. I think much of what I've talked about is actually directly relevant. Indeed, it's even more relevant because in the upstream resources sector, of course, we've got the partnerships and the experience with the broader mining services sector and have established that presence and that experience over many decades. I think to achieve the same outcomes and strength in the downstream sector, the policy settings matter in terms of attracting investment and the reliability of that. I think partnerships with whether it's downstream players, but particularly, we've seen the, I mean, if we think about nickel back to your example and the partnerships that we saw, say in Indonesia to unlock nickel processing and then establish that sector at scale, I mean, that's the kind of transformational partnerships and focusing on lowering the cost of supply. Now, we would of course, as I said, I think in my remarks, the standards, the ESG standards we have here in Australia are something that we're very proud of. But that concept of unlocking through technology and partnerships, I think, has huge relevance.

So look, I think in terms of provision of energy and energy generation, like many, there's a broad thematic of our scope two and our scope one emissions, which is, you know, huge progress on scope one, which is predominantly on solar and wind, but increasingly the firming power component of that, as you call out, is important. And inside the mine gate, very different from diesel displacement. Look, I think in terms of nuclear per se, as is apparent, the transition to renewables isn't necessarily a straight line, and the stability of grid, the importance of firming power, be it from gas, be it from nuclear, is increasingly something that we actually have to solve for. And so our position, particularly on nuclear, is let's not take it off the table. We need to have a technology and technology-agnostic approach to energy, and let the market decide. Let the market decide what is the appropriate generation technology to take forward. So great question, lots to play out.

So the standards are great. I think the reality of getting a project up is incredibly complex. I think the Samuel review called that out actually with a lot of richness. I think you've got to bring the project proponents together with policymakers and essentially take a case study approach. And equally, where we've got major projects of national significance, we've seen other governments take a more curated approach, both in streamlining permitting for all projects, but also recognizing where you've got projects of national significance, how do you curate those and provide some guardrails as it goes through the process.

Look, a good question, and there may well be others in the room who are actually closer to this, particularly as you call out the aluminium and not in the nickel, of course, at the moment. I think the strategic dialogue question comes back to that earlier question on the energy grid more broadly in Australia, because a grid that's stable, an energy mix that has diversity to it, that's reliable and lower cost, takes advantage of some of the indigenous resources that we have as well as the investment in renewables, is one that'll be inherently lower cost. So dialogue, yes. Look, I'm not close to that specifically myself, but in the same way as I would take a view on how do we unlock permitting to be both sustainable but also efficient and reliable, that same argument would apply in energy.

So in terms of meeting my younger self, I would, and I would say that the same to the students here, is that you've already probably taken the most important step in your career in choosing to be a part of the resources sector, because there's just very little that has such significance in terms of the difference it makes to everything from local communities to developing nations, but also the breadth of opportunities that it offers, both in terms of discipline, but also, you know, opportunities to travel to all kinds of far-flung places. Look, I think in terms of our investment in artificial intelligence, but also innovation and technologies more broadly, I'd say a couple of things. One is the nature of what we do in the resources sector is inherently an environment where in many cases your processes do need to be predictable, stable, safe. So we want people to follow our particular routine and incrementally focus on improvement. Sometimes that's not the approach that truly unlocks bold innovation and step-change outcomes. And so part of what we seek to do through programs like Explore, through some of our venture capital divisions, is to take the business problem we're trying to solve, so resource discovery, understanding, automation, and partner with external partners, whether they're startups or technology companies, and try and bring the business problem together with the data or the technology solution, so that you're really working on the biggest things. But it doesn't always happen internally. A lot of it does, but many times that partnership externally gives you the space and the opportunity to bring more challenge.