BHP, Australia’s largest miner, has entered a $40 million earn-in agreement to fund two copper projects in Botswana, allowing potential acquisition of a 75% stake in the Kitlanya East and Kitlanya West projects. Cobre retains 25%, with exploration efforts supported by BHP’s expertise. This strategic move aims to bolster BHP’s copper portfolio as part of its broader diversification strategy.
BHP, Australia’s largest mining company, is expanding its operations in Africa by entering into an earn-in agreement valued at $40 million to finance two copper projects in Botswana. This initiative allows BHP to potentially acquire a 75 percent stake in the Kitlanya East and Kitlanya West projects, both located in the Kalahari Copper Belt, while Cobre retains 25 percent ownership.
Cobre’s CEO, Adam Wooldridge, described the agreement as significant for the junior explorer, expressing optimism that the Kitlanya projects may host tier-1 copper deposits. The partnership is expected to enhance Cobre’s exploration efforts through a technology-oriented approach. The company also has other copper prospects, Ngami and Okavango, which will be developed independently of BHP.
The Kalahari Copper Belt spans approximately 1,000 kilometers between central Botswana and northeast Namibia, and the Motheo Mine, operated by Sandfire Resources, is nearby the Kitlanya tenements. BHP exploration officer Tim O’Connor remarked on the potential of the Kitlanya projects, emphasizing the collaboration’s importance for discovering valuable copper-silver deposits.
Ongoing exploration includes a seismic survey at Kitlanya West, with further activities scheduled to commence in April. Additionally, BHP will pay Cobre $15 million based on copper tonnage found, contingent upon a Joint Ore Reserves Committee (JORC) report that assesses the project’s economic viability.
BHP aims to diversify its commodity portfolio to mitigate potential losses in iron ore, which currently generates substantial revenue for the company. Last year, BHP attempted a $75 billion acquisition of Anglo American, aimed at enhancing its copper assets. The company is also developing a “copper province” in South Australia that connects several mines. With copper being essential for advancing AI and green technologies, there are significant supply challenges ahead; BHP’s CEO, Mike Henry, emphasized the need for increased investment in growth capital to align with global renewable energy goals.
In conclusion, BHP’s strategic investment in Botswana’s copper projects represents a significant commitment to expanding its presence in the African mining sector. The collaboration with Cobre not only facilitates access to key resources but also positions BHP to potentially capitalize on the increasing demand for copper in renewable energy technologies. This move aligns with the company’s objective to diversify its commodity portfolio and enhance its copper production capacity amidst anticipated supply challenges.
Original Source: www.news.com.au
