In the technology world, being disruptive describes when a company comes up with an innovation that significantly alters the way that consumers, industries, or businesses operate. A disruptive technology sweeps away the systems or habits it replaces because it has attributes that are recognizably superior.
Being disruptive is not normally a description one would associate with a major mining company and minerals exploration.
As of 2022, BHP (ASX: BHP) is the largest company in Australia, and the largest mining company in the world, both as measured by market capitalization – and the “Big Australian” is now looking to disrupt exploration thoughts across the globe with its new “Xplor” programme.
BHP chief development officer, Johan van Jaarsveld, says the demand for future facing commodities, such as copper and nickel, needed to support the global energy transition is forecast to increase in the coming decades.
“The launch of BHP Xplor will help us accelerate in finding these critical commodities now and into the future.
“BHP Xplor merges concepts from both venture-capital and early-stage accelerators, to establish a fit-for-purpose exploration portfolio of innovative early-stage mineral exploration companies and helps drive their exploration campaigns. It will offer candidates in-kind services, mentorship, networking opportunities with industry and investors and connections.
“Through this programme, we hope to create disruptive results in copper and nickel exploration by identifying new concepts, leveraging new data, and testing opportunities at a much faster pace than discoveries to date.”
Exploring for a better future
“We believe that building a better future is a responsibility we all share and that is why we are committed to accelerating exploration of critical resources needed for the energy transition, through this programme,” Sonia Scarselli, VP, BHP Xplor, says.
For the Xplor programme BHP has welcomed:
- First time entrepreneurs, fresh from research and/or academia with a great exploration idea and data, which are ready to establish a company
- Established teams and companies, with an early-stage and potentially breakthrough idea with data that has yet to be de-risked
- Mature teams and companies, with an exploration concept, data, and some preliminary de-risking activities
Ms Scarselli said the global competition is aimed at accelerating the search for a range of commodities, particularly copper, nickel, and other critical minerals.
Applications for the BHP Xplor programme recently closed and the selection process took place in November 2022, and the first cohort is expected to be announced by the end of the calendar year. Successful applicants will be invited to participate in Cohort 1, starting early 2023.
The programme is designed with three “programme tracks”: technical readiness, business readiness, and operations readiness. The requirements for each programme track will be custom fit to meet each participant’s needs and the duration of the programme may vary (~ three to nine months).
At the conclusion of the programme, each participant will have the opportunity to pitch to BHP for investment. BHP will receive a minority interest in return for the investment on mutually agreed terms.
Programme tracks
- Technical readiness: Advance the geologic concept and characterize the technical risk
- Business readiness: Establish the key infrastructure and operating model for the company
- Operations readiness: Build operations and financial plan for the company’s exploration strategy
Resources
Providing participants with open access to: hands-on Xplor coaches BHP’s service providers and industry contacts BHP’s technical experts and mentors, external advisors for professional services, Xplor events, university-led “masterclasses”.
Pitch day
An opportunity to pitch for capital to fund a drill programme that will start to define their resource. Mr van Jaarsveld said the accelerator programme will support early-stage mineral exploration start-ups to find critical resources, such as copper and nickel, to help drive the energy transition.
“BHP Xplor merges concepts from both venture-capital and early-stage accelerators, to support and develop innovative mineral exploration ideas and companies.
“The time is now to accelerate the exploration of resources the world needs now and in the future. If you have a big exploration idea, I encourage you to get involved,” Mr van Jaarsveld said.
Exploration powering growth
In its 2022 Annual Report presentation, BHP stated that it continues to have a focus on growth through exploration, focused on copper and nickel.
“Our exploration programme is focused on copper and nickel. We look to identify and gain access to new search spaces to test targets capable of delivering high-quality, Tier 1 deposits, and maintain research and technology activities aligned with our exploration strategy,” the company reported to shareholders.
BHP’s resource assessment exploration expenditure increased by 30% in FY2022 to
US$179M, while its greenfield expenditure increased by 43% to US$77M.
“Despite the slowdown and restrictions on movement due to the COVID-19 pandemic,
in FY2022 our field teams pursued copper opportunities in Chile, Colombia, Peru, Ecuador, the US and Australia. This involved early-stage reconnaissance work through target definition and drill testing,” the company revealed.
“Elsewhere for copper, we continued to seek, secure and test concessions in regions such as Ecuador, South Australia, Chile, Mexico, and Peru.
“We have also increased the number of high- quality nickel projects within the exploration pipeline. We are actively exploring nickel targets in Western Australia, while in Canada, we continued our partnership with Midland Exploration Inc (TSXV: MD) in Canada through our 5% interest and collaboration on a target generation programme.
“BHP made a US$40M investment in Kabanga Nickel in Tanzania in FY2022, which offers an opportunity to expand the immediate search space to add to the known resource.
Our business partnerships continued to deliver encouraging results.
“In Ecuador, we maintained a 13.6% ownership in SolGold plc (LSE: SOLG), the majority owner and operator of the Alpala porphyry copper-gold project.
“In Mexico, we continued our financial agreement with Riverside Resources (TSXV: RRI), a US company with significant operating experience in Mexico, securing additional areas that are scheduled to be drill tested during FY2023.
“In Australia, we initiated work with Encounter Resources (ASX: ENR) to explore for sediment-hosted copper deposits in the Northern Territory. We also entered into a Letter of Intent with Mundoro (TSXV: MUN) to cooperatively explore for copper resources in the highly prospective belt in Serbia and Bulgaria. Several drill-ready targets are scheduled to be tested during FY2023,” the company added.
