BHP Billiton : Laura Tyler IMARC 2018 keynote

IMARC, Melbourne
Laura Tyler, Asset President Olympic Dam, Head of Geoscience and Resource Engineering, BHP
Thursday 1 November 2018, 9.00am

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Sustainable Mining

Thank you Tania, for that kind introduction.

Before I begin, I'd first like to acknowledge the traditional owners and custodians of the land on which we meet today, the Wurundjeri People of the Kulin Nation, and pay my respects to their Elders past and present.

It's great to be back in Melbourne and it's an honour to be at IMARC.

Today I want to reflect on and appreciate the fundamentally important role that we as scientists and engineers play in the sustainability of our operations, our industry and our place in the world.

As we all agree (I hope) mining is the bedrock of our society.

And it is about more than digging a hole in the ground. Much more.

Its presence is felt in everything we touch. It delivers the products that we need to make the world work:

• The iron and coal for the steel that creates our buildings and railways;
• The fertilisers that support our food production;
• The petroleum that generates our electricity and runs our vehicles; and
• The copper that brings electricity into our homes, and powers our devices.

A recent Kellogg Innovation Network report estimated the mining industry directly accounts for around 21 per cent of all measured global economic activity.

When you factor in mining's impact on the products and services I just mentioned, this number more than doubles to 45 per cent.

Almost half of all global economic activity! But you all know this.

Mining has always mattered, and it always will. But it cannot take its place in the world for granted.

Social acceptance of mining is far more complex.

Mining has to earn trust - and maintain that trust.

And trust demands honesty. And the truth is that our industry has made mistakes.

Historically, we focussed on the resources that were easiest to reach; and on extracting them as quickly and cheaply as possible.

Extraction was often prioritised ahead of safety, community longevity and engagement, and environmental impact. The industry reputation is still tarnished by these legacy practices today.

We know population growth and rising living standards will drive demand for energy, metals, and fertilisers for decades to come. Our ability to meet this demand will require us all to make our operations and practices sustainable.

Last year, the CSIRO published a study into Australian attitudes towards mining.

It found that the majority of Australians supported the industry, but 60 per cent - almost two thirds - believed mining has a negative impact on the environment.

In other words, people know that they need mining, but they don't always like it. And if the industry holds a reputation for putting profit before people - and damaging but not remediating the environment - we will lose trust.

There is an imperative for our business, our industry and all global corporations to contribute beyond our core operations.

You may remember the letter that Larry Fink - CEO of Blackrock and also one of the largest global investors - wrote to business leaders earlier this year. He urged them to give the same weight to their societal and environmental performances as their financial performance.

I share his sentiments completely. It's our accountability as resources companies to ensure that we extract the materials the world needs responsibly, with a view for the long-term.

The equation is simple. If we fail to make our operations more sustainable - both environmentally and with longevity - we will lose our social licence.

The good news is that in recent decades, the industry as a whole has started making sustainability a standard work practice. It is thinking more holistically. Placing higher value on people, the environment, and the communities that host our operations.

At BHP, we champion sustainability as one of our core cultural values. Indeed it's why many of us work for BHP. And it's ingrained in every action we take.

The wellbeing of our people, host communities and the environment is considered in everything we do.

So sustainability matters.

It's a global issue, a mining issue, a business issue. And it's as fundamental to our business as the price of iron ore.

That's why we set clear targets to challenge ourselves, drive improvements and allow others to assess our performance.

At BHP we track our performance across four main areas:

• 'People'. Are we doing the best for their health, safety and wellbeing?
• 'Society'. Are we having a positive impact on the communities in which we operate, and the world more broadly? Do we bring the longevity to our operations that allows communities to florish?
• 'Climate change'. Are we maintaining or reducing greenhouse gas emissions as we continue to grow the business?
• And finally… 'Protecting the environment'. Are we doing what we can to reduce our impact every day, and are we using water wisely?

I'll expand on these points in a moment.

I stand here today not only as a mining executive, but also as a representative of the scientists and engineers of BHP.

Yes, we set ourselves strict sustainability targets. But it is up to our people, our engineers, and our scientists to ensure we meet them.

From the design of our exploration pads, to the operation of our waste dumps and tailings facilities, through to the closure and rehabilitation of our operations - I'm constantly amazed by the ability of our scientists and engineers to identify and implement long term solutions.

Take our new South Flank project in Western Australia, for example. South Flank is expected to generate iron ore for over 25 years. This means it will benefit, through investment and jobs, a large section of the local community that haven't even been born yet. This is a huge responsibility.

Through engineering excellence, and by thinking long term about safety and, operational and design practices, we are putting ourselves in the best position to guarantee financial returns for the full lifespan of the mine and beyond.

This benefits all stakeholders: us, our host communities, governments and shareholders.

I'd like to return to the first of the sustainability priorities I mentioned a moment ago. The health, safety and wellbeing of our people.

Our global workforce is the foundation on which the business is built. And BHP's top priority is to provide a healthy work environment that promotes wellbeing, inclusion and diversity and above all, safety.

Safety is a core value that we include in every element of our designs. Take our Safety through Design program, for example. Safety through Design started in our Potash business and is now being rolled out in other projects. We use historical data and the experience of our maintenance and operational crews to help us 'engineer out' safety issues before they eventuate.

Innovation and technology presents us with a myriad of opportunities to redesign the way we work and therefore take our people out of harm's way.

I can point to an example that came across my desk as recently as last week.

One of our Iron Ore operations in the Pilbara was experiencing issues with one of its deflector chutes. The chute was often getting congested, which means that someone has to clean it out. A potentially dangerous task.

The site team analysed the trajectory data and engineered a solution that altered the ore stream and improved the flow.

Not only was this a productivity win, but it made the job safer by eliminating the need for someone to clear the blockage manually.

There are countless other examples of how our operators, maintainer and engineers are using technology to improve safety practices across the entire business.

At the site that I oversee - Olympic Dam - a number of safety initiatives are underway to minimise worker exposure to diesel particulate matter - or DPM - which is one of the main underground material exposures we face.

Over the past two years, in collaboration with OEMs, we've retrofitted diesel particulate filters to our fleets with a significant reduction in DPM exposure across the mine.

And more recently, we began to trial the use of light electric vehicles in our underground fleet, which will reduce our exposure even more.

Our second sustainability priority is Society.

BHP simply couldn't operate without prosperous and engaged host communities, who in turn benefit from the longevity and stability of our operations.

Long-term, sustainable employment and business opportunities are fundamentally important to ensure we create lasting benefit to communities and people. This employment is based upon the science that defines the orebody and the design that maximises returns.

We are particularly focused on building our indigenous workforce. This financial year, Olympic Dam is aiming to increase its indigenous participation from 4.3% to 5.9%, in line with BHP's national target.

I'm pleased to say that we are improving at the entry level, with our apprentice group achieving nearly 15% indigenous participation.

We also work with our Traditional Owners to help them build their own economic prosperity.

The land that encircles Olympic Dam and Roxby Downs is the ancestral home of the Kokatha peoples. On this land are three pastoral stations that have not been operational for many years.

We're funding a project to help refurbish and restore these properties to fully operational cattle stations. With this support, Kokatha people are installing solar panels, cleaning dams and repairing water supply infrastructure. In time, they aim to establish their own herds.

This project is helping to economically empower Kokatha women and men through productive work on their own country - on lands that that have being an important part of their culture for generations.

Our third priority area is climate change - one of the greatest challenges the world faces.

Many of you may have read the report that the Intergovernmental Panel on Climate Change, the IPCC, published earlier this month on the pathways to limiting warming to 1.5 degrees.

BHP accepts the IPCC's assessment that climate change is a reality, and that the human impact is clear. We also accept our industry's contribution to this reality.

We have a clearly defined climate change strategy that will help us maintain our greenhouse gas emissions as we continue to grow our business. And, for the first time, we have set a longer-term goal of net-zero operational emissions in the second half of the century.

Our climate change strategy also prioritizes investment and research into low emissions technologies - like carbon capture and storage - or CCS.

When implemented correctly, CCS can capture up to 90 per cent of carbon emissions that are produced from electricity generation and industrial processes.

The IPCC views CCS as an important contributor to keep the increase in global temperatures to well below two degrees. And BHP agrees.

Our job is to make sure we meet the world's growing energy demands while limiting climate change in line with current international agreements.

This is why we've partnered with SaskPower in Canada to share lessons learned from their Boundary Dam project.

Boundary Dam was the world's first coal-fired power station to be retrofitted with CCS, and it captures close to 1 million tonnes of CO2 per year.

We're also working with Peking University in China to explore how CCS could reduce emissions from industrial processes like steel-making.

As a geoscientist, this is an area of great personal interest, and I am proud to work for a company that maintains research in areas of new technology and utilises our experience and technical skills to provide a better future for the world.

Just as climate change remains a global challenge, we also recognise our role in safeguarding one of the planet's most precious resources - water.

Water is a globally shared resource and access to clean water is an essential human right. But rising populations and increased demand for steel and energy have the potential to stretch water resources.

This year BHP published our Water Report - the first of its kind for our industry.

In it, we established a goal to reduce our fresh water withdrawal by 15 per cent over the next five years, with a longer-term goal of integrating our water resource management in all the catchments where we operate.

In Chile, we aspire to cease groundwater extraction altogether for operational supply by 2030. And this transition, led by the geoscientists and engineers of Minerals Americas is already well underway.

This year we launched the Escondida Water Supply - or EWS - one of the largest desalination plants in the world.

The EWS pumps desalinated water over 180 kilometres to our Escondida copper mine, which is located almost 3,000 meters above sea level in the Atacama Desert - one of the driest regions on the planet.

The level of engineering required to pump water to these heights - and across these distances - is nothing short of incredible. This water supply strategy is a milestone in the history of mining in Chile.

In Australia, our geoscientists are working alongside the Australian Government to recover water pressure across the Great Artesian Basin.

The Great Artesian Basin is one of the largest underground reservoirs in the world, and it supplies water to Olympic Dam and the nearby townships of Roxby Downs and Andamooka.

The extraction of water for industrial and agricultural use reduces the water pressure and causes lower environmental flows to artesian springs that arise from it.

We're capping, repairing and restoring uncontrolled bores in order to offset the impact on water pressures in the vicinity of these springs.

And we estimate that since 1999, Olympic Dam has contributed to approximately 235,000 megalitres in cumulative water savings for the region.

To conclude, expectations of the resources sector have changed. As scientists and engineers, we must rise to the challenge.

We must show our commitment to sustainability through application of technical excellence, innovation and technology partnered with operational discipline and delivery of results.

Fail, and we risk our social license.

The world needs a healthy and productive mining industry. And society demands one that's also safe, environmentally responsible, sustainable, and transparent. If we are to meet rising demand for energy, metals and fertilisers for decades to come, we must become all of the above.

I'm confident that the resources industry - through the contribution of our scientists and engineers - can become active campaigners for change and tackle some of the greatest global sustainable development challenges of our generation.

We should be proud of the role we will play in solving these problems and recognise the opportunity we each have to make a difference both to the people who work for or with us, the environment in which we operate and the lifestyle improvement we support.

Thank you.