BHP Billiton: Second AGM but apparently no second thoughtsPublished by MAC on 2013-11-24
Source: Statement, ABC, Mining.com, Reuters (2013-11-21)
BHP has not had its second AGM after their London shindig (see: An unchanging climate at BHP Billiton). An unchanging climate at BHP Billiton)
As ever in Australia the issue of uranium mining featured more strongly, challenging the company over the proposed expansion at Olypmic Dam (currently on hold). Also the company is talking about adding phosphate as the fifth pillar of its extractive empire.
Otherwise it looks like the climate change debate still dominated the BHPB AGM. It doesn't sound like the company have come up with any new arguments, except to say they are not interested in renewables and the same old argument that they are meeting demand from China etc.
That said, the new CEO Andrew MacKenzie is quoted as saying: "We're having to think quite quickly about how we adapt our portfolio in light of many of the issues raised at this AGM (climate change)"
Arabunna elder highlights the costs of BHP's uranium trade at annual meeting
Australia Nuclear Free Alliance (ANFA) media release
21 November 2013
Mr Kevin Buzzacott, the President of the Australian Nuclear Free Alliance and a respected Arabunna elder will today take his concerns over the proposed expansion of the Olympic Dam uranium mine in South Australia to BHP Billiton's annual meeting in Perth.
Mr Buzzacott has been vocal in opposing the Olympic Dam uranium mine and the planned expansion. Mr Buzzacott unsuccessfully tried to halt the expansion through the courts and has now been ordered to pay court costs to the Government and to BHPB. At today's meeting he will be asking whether BHP, the world's largest miner, will be seeking to follow this cost order.
"I'm an Arabunna elder and I've spent the last thirty years trying to protect my country and the water from my country from this monster mine," said Mr Buzzacott. "Now I've come all the way from South Australia because this is so important for me, I'm getting old and this could be my last chance to get BHPB to quit to shut Olympic Dam down and leave the desert and us in peace."
"All my life I've stood up for my country because that is the right thing, that's what we're taught to do. Now BHPB have a choice whether they're going to penalise me, take me for the court costs, for standing up for my country - or whether they're going to respect my rights to protect those sacred places."
The planned massive expansion of Olympic Dam has been shelved because of low uranium prices and market uncertainty. The current Olympic Dam mine consumes over thirty five million litres of water day from the Great Artesian Basin from Arabunna country and any future expansion would increase pressure on water resources.
"Now you say the expansion is on hold well we have a right to know whether you're going to try and get this expansion happening or not. I mean it doesn't make sense to dig deeper when people are waking up and saying no to the nuclear industry around the world."
"Our land is our life and we will follow BHP Billiton to the ends of the earth to stop this mine from damaging our country and draining our water," concluded Mr Buzzacott.
Mr Buzzacott will be at the BHP Billiton annual meeting from 11am and available for comment after the meeting.
For media comment:
Mr Kevin Buzzacott - 0431 157 747
Ms Mia Pepper - 0415 380 808
Arabunna Elder pleads with BHPB shareholders
By Gerry Georgatos
22 November 2013
An Arabunna Elder has taken his concerns over BHP Billiton's uranium mine expansion to its
Kevin Buzzacott, President of the Australian Nuclear Free Alliance told shareholders he's spent
the past 30years fighting to protect his Country from uranium mining.
BHP is planning to expand its mining operations at South Australia's Olympic Dam site.
Mr Buzzacott travelled to Perth for the meeting.
Climate change the big ticket item at BHP Billiton AGM in Perth
By Babs McHugh
Australian Broadcasting Company (ABC)
21 November 2013
The BHP Billiton Annual General Meeting (AGM) in Perth, Western Australia, was dominated by questions on climate change impacts and the company's mitigation strategies.
A former coal mining and oil and gas executive turned climate change activist, Ian Dunlop, was there to try and gain at seat on the BHP board, a move not endorsed by the company.
Mr Dunlop says the greatest challenge the world and BHP Billiton face is global warming caused by human fossil-fuel consumption.
"The current Board must take action by changing investment priorities far more extensively that it has.
"I consider my particular mix of experience and global perspective would complement existing board member skill to achieve what must be top priorities for BHP and its shareholders."
He says while he accepts the company is addressing the matter of climate change, it could be doing much more.
"BHPB acknowledges the risks of increasing greenhouse gas concentration in the atmosphere needs to be addressed.
"But there's a disconnect between this stated view and its continued investment in fossil fuels; particularly coal but also unconventional oil and gas."
Mr Dunlop also attempted to gain a seat on the Board at the BHP AGM in London last month but failed after winning only four per cent of the vote.
It could possibly be two weeks before the votes are counted for the Perth AGM but the proxy votes that were counted indicated 3.5 per cent support.
BHP Defends its record on climate change action
BHP Billiton Chairman Jac Nasser defended the company's record on climate change in his sometimes short responses to questions about what the company is doing to reduce emission
"We're frustrated that BHP is one of the few companies that's had the courage and the foresight to be on the front foot on tackling climate change.
"We agree with the science, we agree global emissions need to drop and we have had a a climate change charter that we've been reporting to shareholders for over a decade."
Mr Nasser says the company reduced total greenhouse gas emissions by 16 per cent across global operations from 2007 - 2012 and incorporates a carbon price into all modelling, including liability, for new and existing operations.
"We are not blindfolded to the issues of environment and other challenges. We test scenarios in the marketplace including catastrophic climate change."
Mr Nasser also said BHP Billiton is in the resources industry, not renewable energy, a position backed by CEO Andrew McKenzie.
"We're a specialist resources company, we won't be entering the renewable energy sector, although we expect demand for our copper (from the Escondida mine in Chile) to rise as more wind turbines are built.
When pressed further on why shareholders shouldn't be concerned about a drop in the value of their shares if BHP stays in the fossil fuel market, Chairman Jac Nasser replied
"Your concerns over investment are your concerns - you should make up your own mind on where you invest.
"BHP Billiton will not be investing in wind and solar power. If that's what you're interested in investing in, go and cash in your shares."
"Wind power turbines need a lot of copper to operate."
China still the key but who knows where are energy markets heading?
China is major buyer of BHP's coal and iron ore as it continues rapid urbanisation unabated and expectations it will grow seven per cent next year alone.
More than 30 per cent of the company's revenue is generated by sales to that country and the company's oil and gas arm is growing rapidly in Australia and overseas.
But CEO Andrew McKenzie says the global energy scene can change rapidly
"We're having to think quite quickly about how we adapt our portfolio in light of many of the issues raised at this AGM (climate change)
"But it depends on China, it depends on the competitiveness of Australian gas versus gas elsewhere.
Chairman Jac Nasser pointed to the massive leaps the USA has made with recent shale gas developments.
"Who would've thought just a few years back about what's happening in the USA in terms of gas versus coal?
"Who would've thought the direction where Japan is headed (massively reduced uranium consumption after Fukushima nuclear facility meltdown )?
"Or where Germany is headed (increased renewable energy production after Fukushima)?
"So I would say it is fraught with risk to say with any certainty where the energy markets are heading.
"With the one exception that is: it will continue to evolve and change.
"And we happen to be in an extremely strong position because whether you're looking at coal, gas, oil or uranium, we just have that magic mix of all those potential outcomes."
Aboriginal elder unlikely to face court costs over Olympic Dam mine expansion
BHP Billiton would neither confirm nor deny that it plans to pursue a South Australian Aboriginal Elder for court costs.
Kevin Buzzacott of the Arabunna people was ordered by the Federal Court to pay costs to the SA and Federal Governments and BHP after a failed appeal over the expansion of the Olympic Dam uranium, copper and gold mine.
Mr Buzzacott argued the proposed expansion, which has since been shelved, was approved without proper consideration of the long term environmental impact.
But three judges ruled that lawyers for Mr Buzzacott failed to make out the grounds for appeal and ordered him to pay court costs.
Sources close to the world's largest mining company told the ABC it's very unlikely the miner would consider pursuing Mr Kevin Buzzacott for costs.
They added that BHP Billiton doesn't have a track record of pursuing individuals on this basis.
Australia needs price mechanism to cut emissions - BHP
21 November 2013
PERTH - Global miner BHP Billiton , a fierce opponent of Australia's controversial carbon tax, said it still believed an alternative form of financial incentive is needed to cut emissions.
Australia's conservative prime minister, Tony Abbott, elected in September on the promise of abolishing the tax, set up a showdown within the Australian senate in December after 11 repeal bills cleared the parliament's lower house on Wednesday.
"There is no one single solution... We do believe that a price mechanism of some sort is a valid approach," BHP Chairman Jac Nasser told reporters following an annual meeting dominated by talk of climate change and corporate responsibility.
Labor, now in opposition, has conditionally agreed the carbon tax should be terminated but only if it is replaced with a market-based emissions trading scheme to discourage pollution.
Australia has the world's highest carbon emissions per capita owing to its reliance on coal-fired power for electricity.
Labor's carbon pricing plan aimed to tax major polluters with the world's highest carbon price of A$23 ($22.23) a tonne, before moving to a market cap-and-trade system by mid-2014.
BHP had argued the carbon tax, introduced by the former Labor government in 2012, would harm Australia's competitiveness and was unlikely to reduce the amount of CO2 going into the atmosphere around the world.
Abbott is proposing a so-called direct action plan, including an emission reduction fund and a market-based incentive to reduce greenhouse emissions.
Responding to shareholders, Nasser said BHP "accepts the climate change science" and that "actions have to be taken", but said the company would not invest in alternative energy sources such as wind and solar power.
The legislation to repeal the carbon tax will now proceed to the upper house, where Labor and the Greens party currently have the numbers to block the bills.
"Now is a good time to stop and reevaluate what's the best way forward," Nasser said.
BHP Billiton: climate change leader or laggard?
Australian mining firm, under fire for supporting carbon tax abolition, can either join the leaders or stay a fossil fuel dinosaur, writes Malini Mehra
20 November 2013
As ministers gather in Warsaw this week for the UN's latest round of intergovernmental negotiations on climate change, and the Philippines reels from the strongest storm ever recorded, officials at BHP Billiton, the world's largest mining company, is preparing for their AGM on 21 November in Perth.
It's a global company with 128,800 employees. Last year it made $11.8bn dollars in profits and paid $11.6bn in taxes and royalties. For countries such as Australia, South Africa and Chile, its taxes make an important economic impact.
As with its corporate peers, BHP defines its purpose as creating long-term shareholder value. Its executives will tell you that its growth strategy is to invest in large-scale, long-life, diversified assets. But BHP also has a steady line in fossil fuels. It is proud of its US shale gas acquisitions of recent years and at its London AGM in October, highlighted coal and petroleum as two of its four core pillars.
The company is no corporate climate sceptic. BHP has long accepted the mainstream science on climate change. It has been reporting voluntarily on GGH emissions since 1996, was an early pioneer in energy efficiency measures, and is now focusing on its water footprint.
In September 2010, the company embarked on a step-change when the former chief executive, Marius Kloppers, publicly called for a carbon price in Australia. Timed just ahead of the Gillard government acceding to office, this started a debate that was long overdue in a usually defensive domestic mining sector.
Now times are different. Australia's political context has changed dramatically with the new government claiming an electoral mandate for its anti-climate agenda. In the past few weeks, BHP has supported Australia's Abbot government on its legislation rescinding the country's commitment to a carbon price.
What happened? In the intervening three years since Marius Kloppers' famous speech, we know far more about climate risk. The work of HSBC, Deutsche Bank and the Carbon Tracker Initiative has galvanised institutional investors and pension funds on the economic risks of unburnable carbon.
In recent months, the heads of the IMF and the World Bank have reiterated their priorities of removing fossil fuel subsidies and putting a price on carbon. As we are seeing in the Philippines, climate inaction can mean decades of development progress is wiped out in a single extreme weather event, predicted to become more frequent as climatic changes become more severe.
When asked about unburnable carbon at BHP's London AGM, company leaders sought to reassure saying the company had considerable capacity to address risk to its portfolios and that the issue of climate change was under regular review.
Why then critics charge, the back-tracking on the carbon tax - widely seen as a cornerstone of international policy efforts to tackle climate change? According to BHP's submission to the Carbon Price Repeal Taskforce, in essence, the company is objecting to what it sees as a tax on its competitiveness with other jurisdictions and unfair coverage of fugitive emissions.
Is a carbon price really at risk of undermining a company such as BHP's global competitiveness? UBS analysts have suggested that for the big miners such as BHP in the USA, the carbon tax accounts for barely 1% of revenues.
As with many in the private sector, BHP puts its faith in the need for a global solution to climate change. But has their intervention helped or hindered the global consensus needed for effective climate policy? Is their seeming support for a renegade government consistent with their business interests in avoiding a four degree world? It may well be that BHP's leaders are unaware of the consternation that their public policy engagement has caused among climate negotiators in Warsaw and activists on the ground.
Like many of its peers, BHP produces an annual sustainability report. Unusually, it gives away 1% of pre-tax profits to community programmes every year - in 2013 this came to $245.8m supporting initiatives such community enterprise in Colombia.
In a world increasingly distrustful of corporate tax-avoidance and greenwash, these are dangerous times for companies such as BHP. Critics can legitimately question the companies decision not to pay 1% of revenues in carbon tax, in favour of spending 1% of pre-tax profits in corporate largesse to a community fund to gain kudos?
From its own crisis in the OK Tedi mine in Papua New Guinea in the 1990s, BHP has learned the hard way of the need to gain social licence to operate. At a time when the global divestment movement is taking hold on campuses, with institutional investors, and in grassroots communities opposed to resource exploitation and fossil fuel pollution, BHP's size and visibility makes it more vulnerable than most.
To affected communities and those at the climate talks in Warsaw the fear and urgency is real. They know we are in an era of climate consequences.
Looking to the future, the company has a choice to make. BHP can join the small but growing leadership group of companies which realise there will be no global consensus on climate action unless they play an active role in forging it. Or BHP can side with the fossil fuel dinosaurs and delay the inevitable leaving disaster and damage in their wake.
The good news is that the company's diversified strategy is a core strength. The shift needed for the post-carbon age is one that the company can make better than most. With vast holdings in copper - its Escondida mine in Chile is the world's largest copper mine - and also nickel, uranium and other elements of the new economy, the company can indeed help resource the low-carbon future.
Climate change is already on the agenda at the Perth AGM this week with the nomination to the BHP Board of Ian Dunlop, former senior oil, coal and gas executive, and now advocate for climate action. Dunlop, an external shareholder nominee, is not endorsed by the BHP Board, but is endorsed by influential pension funds such as CalPERS - and others are taking note.
This AGM must be a watershed drawing a line in the sand on BHP's commitment to the climate challenge. With power and responsibility comes an expectation of leadership. BHP can stake its moral vision for the future and how it will build a credible long-term strategy for climate resilience for the company and the communities it serves. This is the best time for climate leadership, and the worst time to lose one's nerve.
Malini Mehra has served as adviser to three CEOs at BHP Billiton as member of the company's Forum on Corporate Reaponsibility and is on the board of GRI
BHP's potash priority
21 November 2013
Potash is to become the 'fifth pillar' of BHP's operations as global demand is expected to increase 2%-3% each year until 2030, CEO Andrew Mackenzie told shareholders at the company's AGM in Perth on Thursday.
"The growth will be driven by a rising population and greater economic prosperity, which will change the patterns of food consumption, requiring higher yields from increasingly constrained arable land."
"Our continued investment in potash, at an average annual spend of $800-million, will make sure we are ready to take advantage of this opportunity to add to shareholder returns."
BHP's massive Jansen project in the Canadian province of Saskatchewan has an expected output of 8 million tonnes a year of potash and a 70-year mine life.
The other four pillars of BHP's business are coal, copper, iron ore and petroleum.
Environmentalists urge scrapping of Borneo coal project
7 November 2013
JAKARTA -- Environmentalists are calling for mining giant BHP Billiton to abandon coal mining in Indonesia's central Kalimantan province, also known as Borneo.
At issue is the IndoMet coal project, a joint venture between BHP Billiton and Adaro Energy, Indonesia's second largest producer of thermal coal. BHP Billiton owns 75 percent of the project, with the remaining 25 percent held by Adaro.
IndoMet covers 865,000 acres in the Borneo rainforest and is believed to have coal reserves of more than 774 million tons, reports The Guardian newspaper. The first stage of IndoMet's development is a small operation called Haju.
Environmental group Friends of the Earth says IndoMet will cause mass deforestation and damage the rivers of the upper Barito basin.
"These are sensitive forests full of biodiversity," Nick McClean, the group's climate justice spokesman told The Guardian. "There has been some logging of the lowland areas in the past but much of the area hasn't been scientifically surveyed. We could lose species we don't know anything about," he said.
The region is inhabited by remote communities and the endangered orangutan.
"We do know that river systems absolutely will be impacted. It's alarming to think that BHP will be clearing an area simply to export coal that may not have a future."
Hendrik Siregar, Coordinator of The Indonesian Mining Advocacy Network, known as JATAM, in a news release last month said, "BHP Billiton, backed by UK shareholders and investors, tells the world that it is 'resourcing the future.' Local communities in Central Kalimantan are telling us that coal mining is destroying their future."
In a July blog post entitled "What is BHP up to in Indonesia?" Bob Burton, director of Australian environmental organization The Sunrise Group wrote that the mining giant "is keeping very quiet" about its involvement in IndoMet.
Little information on the project was disclosed in the company's presentation to analysts in June, he noted.
In response to an email inquiry, BHP Billiton told Burton that the Haju mine project would cost the company $80 million and would produce one million tons of coal a year from early 2014. However, the company did not respond when asked whether an environmental impact assessment had been undertaken.
A spokeswoman for BHP told the Guardian that the environmental impact of further mining would be fully assessed.
"Our plans do not include mining in any protection forest areas in central Kalimantan, and any development in central and east Kalimantan will be subject to detailed environmental and social impact assessments, feasibility studies and will require all appropriate permits to be in place before activities commence," the spokeswoman said.
BHP in Indonesian Borneo: the coal disaster waiting to happen
Comment, ABC Environment
19 November 2013
BHP Billiton has a massive coal mine planned for Central Kalimantan. But local environmental activists are worried about its impact on people and forests.
FROM MY HOME IN Central Kalimantan, a province on the southern side of Indonesian Borneo, I have observed the Australian coal boom. Recently I was in Australia to talk about environmental destruction in Kalimantan and I was surprised how few people know that Kalimantan is experiencing a similar rush to extract fossil fuels. I think its important for Australians to know more because of the connections between our countries in the global coal market and the environmental crisis it is producing.
Since 2000, Indonesian coal exports have increased on average by 18.4 per cent per year. In 2012 Indonesia produced 504 megatonnes (Mt) of thermal coal the majority of which (383 Mt) was exported. This increase was enough to make us the number one coal exporter in the world, a dubious title that we took from Australia.
The connection between Australia and Indonesia isn't just as competitors in the coal market. Australian companies are also leading the race to cash in on this resource boom.
For example, BHP Billiton's planned megaproject, IndoMet, would be the largest initiative in my home province of Central Kalimantan. The IndoMet project is situated in the thickly forested and remote Upper Barito Basin. It covers 350,715 hectares, roughly one and a half times the size of the Australian Capital Territory, and has estimated coal reserves of 774 million tonnes. This is two and a half Australia's annual thermal coal exports for 2012. Based on the potential of IndoMet alone, the Upper Barito Basin may be the largest coal deposit worldwide yet to be utilised, and the last frontier of global coal production.
A megaproject like IndoMet comes with serious environmental and social costs that BHP and its financiers don't recognise. There are many communities living in the Barito Basin, who have lived on these lands for generations. These communities live in the forests that these mines will clear and drink and wash in the rivers these mines will pollute. We are extremely conscious of how these mines will affect our communities that have depended on forest and rivers systems like the Barito Basin for their livelihoods for generations. Megaprojects risk displacing communities, impacting on their health through air and water pollution, and compromising livelihoods based on small-scale farming.
In my home region we have already seen the destructive effects of resource projects. Some people have sold their communal land to the resource companies but have not seen any long-term prosperity from these mining operations. The jobs that mining companies bring do not last long, and in the few cases that local Dayak people are employed the people who take these jobs often find money does not satisfy them when they realise they are undermining the culture and way of life their people have cultivated for generations.
Those who keep land in communal ownership to protect it from logging and mining are often harassed, and I have seen men attacked and badly injured for standing up to companies in the past. The Indonesian government is often no help at all, and the police and military are well known for standing up for the rights of multi-national companies, not those of the 'orang kampung', the people living in the villages. My organisation has worked in communities all over Indonesia to greater recognition and respect for their land rights and rights to participate in decision making.
Our forests are also of global environmental significance. The heavily forested Upper Barito Basin is home to large populations of orangutans and potentially many other species yet unknown to science. These forests form a significant part of Borneo's mega-diverse and world-renowned forest ecosystems. Their value has been recognised and there is an internationally supported conservation agreement, the 'Heart of Borneo' initiative that aims protect them for their biodiversity and carbon sequestration potential. Yet, the IndoMet concessions are located within the Heart of Borneo area.
If BHP continues with its plans for open cut mines it will be a disaster for my people and it will be a disaster for these fragile ecosystems. The Barito watershed is a home and source of life for thousands of traditional landowners. We simply can't afford to allow our rivers to be polluted and our forests cleared and see the profits go overseas. If the IndoMet project and others like it continue it will threaten our peoples' way of life.
I ask the Australian people, now that you know a little more about Australian coal interests in Kalimantan, do they believe that these companies should be able to pursue these plans when so few people in the local community support them?
These are not only problems for Indonesian people. The extraction and burning of fossil fuels causes climate change which will ultimately affect people across the world. These are questions that I still have but I hope that by raising awareness about these issues other people will ask similar questions and raise their voices to support the struggle of the communities in the villages where my family lives.
Arie Rompas is Executive Director of WALHI (Indonesian Forum for the Environment/Friends of the Earth Indonesia) Central Kalimantan Branch. He is a member of the Dayak Siang people from the Upper Barito Basin, Central Kalimantan.