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Anglo-Australian resources giant BHP wants to add more copper to its already sizeable resources in order to take advantage of the opportunity presented by the expected surge in demand to be driven by electric vehicles (EVs).
And in order to expand its copper portfolio, the Melbourne-based company is focusing on exploration in mature and in promising new jurisdictions, such as Ecuador, Daniel Malchuk, president of BHP Minerals Americas, said in a speech in London.
"BHP is positioning as a global exploration leader. This is not about having the largest budget. It is about allocating the funds wisely through a highly focused and technical approach," he said.
Malchuk told the LME week that in established jurisdictions such as Chile, where the company operates the Escondida, Cerro Colorado and Spence mines, the discovery of a big deposit close to the surface is less likely, as these orebodies are more likely to be at depth and thus more difficult to identify.
"On the flipside, as we venture into less mature regions, such as Ecuador, where exploration activity levels have historically been lower, the potential for new discoveries closer to the surface is greater," he said.
Malchuk said that at the end of its financial year 2017 ending June 30, BHP's copper portfolio comprised 79 projects covering 1.8Mha.
BHP believes as EVs evolve, demand for copper is likely to increase to up to 105kg per car from about 80kg at present, which compares with about 20kg in combustion engine vehicles and 40kg in hybrids.
The fleet of EVs is expected to surge to 140mn by 2035 from 1mn today, which would put demand for copper for EVs at an estimated 12Mt, more than half of the current global copper market, Malchuk said.