BHP Group to Invest Up to $14.7 Billion in Chilean Copper Projects Amid Supply Concerns

Australian resources giant BHP Group is set to invest at least $11 billion in copper projects across Chile, including at Escondida, the world's largest copper mine. This significant commitment is driven by the anticipated global copper supply shortfall of 10 million tons over the next decade.

Details of the investment plan were shared with investors during the week starting on April 18. According to BHP's projections, the company will spend between $10.7 billion and $14.7 billion over the next 10 years to enhance copper ore extraction at its Escondida and Spence mines, as well as to restart operations at the Cerro Colorado mine.

Despite the substantial investment, BHP expects its annual copper production to decrease by about 300,000 tons to 1.6 million tons by 2030, with production at the Escondida mine anticipated to peak by 2025.

BHP America President Brandon Craig, speaking on April 21, highlighted that the copper supply deficit could reach as much as 10 million tons by 2035, with an estimated cost of $250 billion needed to address the shortfall. He also acknowledged that the immense development costs pose a significant challenge for companies engaged in copper resource development.

Other major resource companies are facing similar obstacles as BHP in their efforts to boost production, as many of their existing copper mines are gradually aging.