Edgar Basto on the future of mining in the Bowen Basin

Edgar Basto, President Minerals Australia, BHP

In May 2021, Edgar Basto, BHP President Minerals Australia, participated in a panel session as part of The Australian Competitive Advantage Forum to share his views on BHP’s contribution to the Bowen Basin and the future of mining in the region. Read more about Edgar’s views in this Q&A from the Brisbane panel session:

Give us a brief overview of your assets in the Bowen Basin?

BHP has seven metallurgical or ‘coking’ coal mines in the Bowen Basin in Central Queensland, which are part of a 50-50 joint venture with Mitsubishi Development, and operate under the banner of the BHP Mitsubishi Alliance, or what people may know as BMA. Metallurgical coal is an essential ingredient in the production of steel. Steel is one of the most widely used building materials on earth, and we expect it to remain so in the coming decades.

Last year for example, BMA produced around 65 million tonnes of met coal. That’s enough steel to build the Burj Khalifa (the world’s tallest building) over 1,600 times! Queensland produces the world’s highest quality coal, for which there is strong long-term demand from global steelmakers who want more of it to support their decarbonisation efforts.

What are your workforce needs? Are you seeing a skilled labour shortage in Qld?

We have 45,000 employees and contractors here in Australia, around 11,000 or so in Queensland. As we look to maximise the opportunities that technology and innovation present to us, we’re working with the communities around our mines to ensure they have the skills that we’ll need in the mines of the future. That’s why we are working with schools, TAFEs and universities in the region with partnerships like Queensland Future Skills to develop those new skills.

What does the mine of the future look like?

The mine of the future will be safer, more sustainable and more productive. Mining operations overall will be more diverse, and key to the strength of regional communities and economies.

The uptake of technology is the single biggest factor in the changing face of mining – whether that be automation, data analysis, artificial intelligence and so on. Automation is part of BHP’s strategy to improve safety, build capability and further our competitive advantage. Two of our mines here in Queensland (Goonyella Riverside and Daunia) are implementing autonomous haulage and that work is going well.

Why is a strong coal industry in Queensland important? What has BHP’s economic contribution been in Queensland, and Australia more broadly?

Like any business, we must stay ahead of our competitors to survive and thrive – here in Queensland and around the world. When we achieve that competitive advantage, it means others around us also benefit from the work we do.

BHP is a major employer and contributor to both the Queensland and Australian economies. Our total economic contribution last financial year (FY2020) in this country was US$22.4 billion (approximately A$33.4 billion), and we paid US$796 million in taxes, royalties and other government payments in this state.

What role has BHP - and the resources sector - played in the response to COVID, and the economic recovery of Queensland, and Australia more broadly?

BHP understands and embraces its role in advancing the success of the nation, and we’re ready to support its long-term growth and prosperity. We are playing an active role in a business-led recovery from COVID-19 through jobs, training and business opportunities. That has included:

• Hiring 1,500 people at the start of the pandemic to support our Australian operations;

• Bringing forward payments and temporarily shortening payment terms for more than 1,100 small, local and Indigenous suppliers – delivering an immediate cash injection of $100 million; and

• Establishing a $50 million fund – the Vital Resources Fund – to help regional Australian communities meet the health and economic challenges of COVID. This included around $8 million for health clinics in Central Queensland.

What is the future of Coal?

While we don’t mine thermal or energy coal in this state others do, it’s also relevant to point out that as society transitions towards zerocarbon - which will extend decades into the future - consumption of high-quality metallurgical coal will continue to be critical to meeting global energy demand. The metallurgical coal we extract here in Queensland is an essential ingredient in the production of steel. Steel is one of the most widely used building materials on earth, and we expect it to remain so in the coming decades.

There is 100 years of high-quality metallurgical coal in Central Queensland. We know that continued access to that resource will in part be dependent on sharing its benefits with the community, particularly those in that part of the world. That’s why we’re investing $800 million over the next five years in apprenticeships, training and mining equipment, technology and services (METS) sector businesses – with a particular focus on regional areas. 