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Get Comfy: BHP Gets Century’s Worth of EPA Approvals

The EPA has concluded a six-year review of iron-ore giant BHP’s long-term strategic proposal for the Pilbara, and given the company the go ahead to get comfortable.

The Environmental Protection Agency (EPA) of Western Australia has concluded a six-year review of iron-ore giant BHP’s (ASX:BHP, NYSE:BBL, LSE:BLT) 50-100 year long-term strategic proposal for the Pilbara, and given the company the go ahead to get comfortable by recommending it for approval by the Western Australian government.

The EPA’s environmental impact assessment on BHP’s strategic proposal released today (July 9), outlines the conditions that may be applied to each development, including environmental management plans, a greenhouse gas management plan and a mine closure plan,” said EPA deputy chair Robert Harvey.

“The benefit of assessing a strategic proposal is that we are able to take a bigger picture view of the potential environmental impacts the proposals may have.

“Through the assessment process the EPA was able to consider the cumulative impacts of BHP’s future proposals, rather than assessing impacts on a case-by-case basis, as individual mines or developments are proposed.”

The review considered the impact of BHP’s mining activities in the Western Australian region on fauna, flora, surface and groundwater, air quality and social surrounds.

BHP’s strategic proposal was described as holistic, and is as broad and wide ranging as one would expect of a 50-100 year plan, with 17 sites of activity, including future mines across a vast ‘project area’ nearly 450 km across at its widest point, identified by the company as of interest to its long-term operations.

The EPA was given plenty of work for the six years —it would have needed the time to assess the impact of clearing and preparation of all 17 sites.

Its report included an assessment of cumulative impacts of operations, environmental assessment and “scientifically verifiable estimates of the likely success of future rehabilitation.”

While the EPA was conducting its review, BHP stepped in two years ago to remove the South Flank project from its scope and advance the project faster as a stand-alone proposal. The company gave the project the internal green light last month, committing US$2.9 billion to its development.

BHP has not been given a blank check however. Harvey said that the company would still have to refer individual projects outlined in the strategic assessment to the EPA “to determine if they meet the high environmental standards set by the strategic assessment.”

“Once a derived proposal is referred to the EPA, the authority will determine if there is any significant new information, or if there has been a significant change in the relevant environmental factors, since the strategic proposal was assessed.”

According to the EPA’s report, the Pilbara bioregion, where the mines are located, accounted for 77.9 percent of the BHP’s project boundary, and is far from a wasteland being home to more than 1,700 plant species, the greatest reptile diversity in the vast Australian state and “the richest known groundwater fauna diversity in Australia.”

The Western Australian minister for Environment will have the final say following a two-week period where the report is open to public appeal. The public appeal period will close on July 23.

Last year, BHP’s Western Australia mines produced a total of 231 million tonnes of iron ore.

On the Australian Securities Exchange today (July 10), BHP was trading up 1.09 percent at AU$34.24.

Don’t forget to follow us @INN_Resource for real-time updates!

Securities Disclosure: I, Scott Tibballs, hold no direct investment interest in any company mentioned in this article.

Featured

The mining and resources sector now sets its sights on Australia’s largest mining investment forum, Mines and Money @ IMARC, co-located with IMARC from January 31, 2022, to February 2, 2022, at the Melbourne Showgrounds.

It was gold price, lithium demand and China’s appetite for copper that dominated much of the discussion at Mines and Money Online Connect @ IMARC this week at the virtual event running from the 19th to the 21st October.

Mines and Money Online Connect saw 90 mining companies, 600+ investors and more than 2,000 participants log-on to hear mining executives and analysts discuss the next big thing for savvy investors in 2022.

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Rio Tinto Iron Ore Chief Executive, Simon Trott and Rio Tinto Managing Director of Port, Rail and Core Services, Richard Cohen, joined community members, local businesses and representatives from local government to celebrate the official opening of its new community ‘Hub’ in Karratha. Located on Ngarluma country in the heart of Karratha’s CBD, the new Rio Tinto Karratha Hub will make it easier for local …

Rio Tinto Iron Ore Chief Executive, Simon Trott and Rio Tinto Managing Director of Port, Rail and Core Services, Richard Cohen, joined community members, local businesses and representatives from local government to celebrate the official opening of its new community ‘Hub’ in Karratha.

Located on Ngarluma country in the heart of Karratha’s CBD, the new Rio Tinto Karratha Hub will make it easier for local people to connect with our busines.

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Rio Tinto is progressing an innovative new technology to deliver low-carbon steel, using sustainable biomass in place of coking coal in the steelmaking process, in a potentially cost-effective option to cut industry carbon emissions. Over the past decade, Rio Tinto has developed a laboratory-proven process that combines the use of raw, sustainable biomass with microwave technology to convert iron ore to metallic …

Rio Tinto is progressing an innovative new technology to deliver low-carbon steel, using sustainable biomass in place of coking coal in the steelmaking process, in a potentially cost-effective option to cut industry carbon emissions.

Over the past decade, Rio Tinto has developed a laboratory-proven process that combines the use of raw, sustainable biomass with microwave technology to convert iron ore to metallic iron during the steelmaking process. The patent-pending process, one of a number of avenues the company is pursuing to try to lower emissions in the steel value chain, is now being further tested in a small-scale pilot plant.

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carbon emissions

Following international pressure, the Australian government has promised to reach net zero emissions by 2050.

In a last-minute commitment after months of debate, the Australian government has promised to reach net zero emissions by 2050, expecting to meet the goal largely through technology development.

The move comes following international pressure as Australia had previously refused to join countries in pledging to meet the target ahead of the United Nations' COP26 climate conference in Glasgow.

However, the plan unveiled on Tuesday (October 26), which includes a government investment of AU$20 billion, does not strengthen the target set for 2030, with Prime Minister Scott Morrison saying Australia is on track to beat its Paris Agreement goal, cutting emissions by 30 to 35 percent by that decade.


"We will do this the Australian way," Morrison said ahead of a press conference, announcing investments in new energy technologies like hydrogen and low-cost solar.

An Australian hydrogen industry could be worth more than AU$50 billion in 2050, according to the government. Meanwhile, expanding production and processing of metals like lithium, nickel, copper and uranium could together be worth around AU$85 billion in exports in 2050.

That said, Australia will continue to be heavily dependent on fossil fuels as the plan will not shut down coal or gas production. The country is a major coal player, with the third largest reserves in the world, but its reliance on coal-fired power makes it one of the world's largest carbon emitters per capita.

"We want our heavy industries, like mining, to stay open, remain competitive and adapt, so they remain viable for as long as global demand allows," Morrison said. "We will not support any mandate — domestic or international — to force closure of our resources or agricultural industries."

Australia's desire to achieve net zero emissions by 2050 is a step in the right direction, Prakash Sharma, Wood Mackenzie's Asia Pacific head of markets and transitions, said.

"Our analysis shows that Australia can reach net zero emissions by 2050," he said. The country's major trading partners — China, Japan and South Korea — are already in transition towards that goal.

According to Wood Mackenzie, nearly 83 percent of Australia's power generation will come from solar and wind by 2050, as compared to about 20 percent last year. Natural gas, bio energy, geothermal and small modular reactors will supply the remaining 17 percent in power output. Coal into power is expected to be phased out by 2035.

"Although the pathway requires complete transformation of its traditional energy and export sectors, there are significant opportunities to capitalise on and protect future revenues," Sharma said.

"This will require Australia to become a significant player in low-carbon hydrogen trade as well as being able to offer carbon storage and offset services."

Meanwhile, the Australian Conservation Foundation has welcomed the prime minister's commitment to reach net zero by 2050, but said the mid-century goal is only meaningful with deep cuts to climate pollution this decade.

"Unless the government sets the wheels in motion to cut our emissions in half by 2030, it is making climate change worse and turning its back on the opportunities," said Chief Executive Kelly O'Shanassy.

"Australia can become a global clean energy superpower in the next decade by replacing coal and gas with renewable energy," she added. "We have abundant clean energy, tools and talent, but we cannot delay any longer."

Don't forget to follow us @INN_Australia for real-time updates!

Securities Disclosure: I, Priscila Barrera, hold no direct investment interest in any company mentioned in this article.

map showing Victoria, Australia

The state of Victoria completed an inquiry on cannabis earlier this year. Will it actually change anything for the drug?

In August, the government of Victoria, Australia, released the results of its inquiry into the use of cannabis, taking into account 1,475 written submissions, dozens of expert witnesses and two minority reports.

A few months on, Australia-focused cannabis investors are wondering whether the document's findings will have an impact on cannabis use in the state, or even in the country as a whole.

The short answer? Probably not. But there's more to the story than that.


Why did Victoria conduct a cannabis inquiry?

Back in May 2019, Victoria's Legislative Council Legal and Social Issues Committee agreed to complete an inquiry on cannabis in the state. Although it was initially due for completion in March 2020, the deadline was extended twice, first to March 2021 and then again to August 2021.

Chaired by Reason Party Member of Parliament Fiona Patten, whose party supports legalising cannabis, the committee broadly looked at two streams of cannabis policy reform. One, the legalisation of cannabis for adult personal use, and two, a legalised and regulated cannabis market.

The report puts forth 17 recommendations and 21 findings, but Patten said after its release that the Labor-heavy committee banded together to water down certain recommendations prior to the drafting of the report.

For example, according to reports from the Age, the first recommendation of legalising cannabis for adult personal use in Victoria became "Recommendation 1: That the Victorian Government investigates the impacts of legalising cannabis for adult personal use in Victoria."

Evidence from the inquiry suggests that legalising cannabis would keep young and vulnerable people out of the criminal justice system, with state parliament estimates suggesting Victoria would save AU$725 million over 10 years in police and justice costs.

Key highlights from Victoria's cannabis inquiry

Recommendations from the report broadly fall several categories: investigating a legalised and regulated market; health and safety; and education for minors.

Here's a wrap up of the main items the Victorian government was told to look at:

  • Investigate the impact of legalising cannabis for adult personal use in Victoria.
  • Consider referring an inquiry to Victorian Law Reform Commission to investigate state and Commonwealth laws inhibiting legislation and regulation of the cannabis market.
  • Provide ongoing funding to alcohol and drug sector organisations for drug diversion programs, and further funding to areas in regional and rural Victoria.
  • Implement a road safety campaign about the dangers of driving under the influence of cannabis.
  • Look at alternative testing methods for "drug driving," as current methods mean THC can be detected in a person's system long after being "affected by the drug," especially in the case of medicinal cannabis patients.
  • Advocate to the National Cabinet to remove unnecessary barriers for accessing medicinal cannabis.
  • Seek expert help on school drug education, avoid stigmatising users and promote help-seeking behaviour.

Minority reports included in Victoria's inquiry

Liberal Democrat David Limbrick, who participated in the inquiry, was "extremely disappointed" with the last-minute changes mentioned above and submitted a minority report in favour of legalisation.

It broadly supports the public policy Liberal Democrats have towards cannabis which is: "The Liberal Democrats support the legalisation of use, cultivation, processing, possession, transport and sale of cannabis, with protection of minors and penalties for driving while impaired."

A second minority report is also included — it comes from the Liberals and Nationals, both of which are firmly against legalising cannabis in order to protect public health and children. Signed by three members, it states that legalising cannabis only provides ready access and no deterrent to prevent cannabis use. They further wrote:

"The Liberals and Nationals support drug education programs warning of the harms of illicit substances, we support diversion programs that help get people off drugs, and we support other support services for those addicted to drugs. However, we do not support legalising cannabis."

Victoria Police Assistant Commissioner Glenn Weir told the inquiry in June that the use, cultivation and trafficking of marijuana causes "significant harm," and said he is firmly opposed to legalisation.

Will the inquiry impact cannabis legalisation in Australia?

Any hopes of legalisation were quickly dashed after the report's release by Victorian Premier Dan Andrews, whose focus is on job creation and economic recovery from the coronavirus pandemic.

Speaking to reporters after it came out, he said he has "no intention" of legalising cannabis.

"If you want to know why, then have a look at the sections in the mental health royal commission that talk about dual diagnosis, drug-induced psychosis," he told reporters outside parliament.

"Others have a different view, they're entitled to have a different view, but as the leader of the government I've just made the government's position very clear."

The lack of support by major state parties for the Victorian inquiry may speak to a wider delay nationally for supporting decriminalising and legalising cannabis. Combined with the narrow defeat of the cannabis legalisation referendum in New Zealand, it does not look like legalisation is likely anytime soon.

Don't forget to follow us @INN_Australia for real-time updates!

Securities Disclosure: I, Ronelle Richards, hold no direct investment interest in any company mentioned in this article.