BHP’s looming $US3.2 billion ($4.2bn) investment in the new South Flank iron ore mine will not only maintain the mining giant’s Pilbara output but could strengthen community trust that has come under strain in recent years, according to Mike Henry, BHP’s president of Australian operations.
BHP yesterday announced it had committed $US184 million to early construction works at South Flank deposit, which is expected to replace the 80 million tonne a year Yandi mine when it runs out of ore next decade.
The mining giant also revealed that the South Flank project was expected to cost between $US30 and $US40 a tonne of annual production capacity, which would make it the single biggest new mining project in Australia since the construction of Gina Rinehart’s Roy Hill mine.
In Perth yesterday, Mr Henry said the project would create several thousand jobs during construction as well as “many hundreds” of longer-term operational jobs. He said the project would help repair the “social contract” that had started to fray in recent years as investment from the resources sector slowed and job cuts across the industry accelerated, amid a broader “erosion of trust” in big business in Australia, in line with the broader trend of rising populism and nationalism around the world.
“The reality is society quite justifiably expects companies like mine to not only operate within the law, but to ensure a sustainable quid pro quo in terms of ongoing investment, job creation, upskilling, support to ensure sustainable communities, and of course ongoing opportunities for local businesses to share in the wealth pie,” Mr Henry said.