CANBERRA: Ongoing energy disruptions will set back efforts to curb greenhouse gas emissions as nations prioritise supply security, according to one of the most senior executives at the world’s top mining company, BHP Group.
“Geopolitical fragmentation has repositioned resources and energy from traded commodities into instruments of national power,” Geraldine Slattery, president of BHP’s Australian operations, which include vast iron ore to copper mines, said in a speech in Canberra.
“Resource and energy security and affordability have overtaken supply chain decarbonisation as the dominant policy priority in many major economies,” Slattery said in the Tuesday speech.
That shift has “real implications for investment decisions, and for the pace and pathways of decarbonisation”, the BHP executive added.
Volatility across oil and gas markets as a result of the conflict in the Middle East and a squeeze on tanker traffic through the vital Strait of Hormuz has prompted some nations to cap fuel exports and others in Asia to turn back to coal.
While there’s evidence of consumers snapping up electric cars, solar systems and other green technologies to limit reliance on fossil fuels, major industries face a far more difficult task.
Melbourne-based BHP, which has cut operational emissions more than a third from a fiscal year 2020 baseline, is switching some large sites to renewable energy and deploying electric equipment, including giant haul trucks.
Still, the producer faces challenges in significantly curbing its use of diesel-powered vehicles and told investors last year that spending on decarbonisation would slow until the 2030s to reflect the sluggish development of technology.
Rio Tinto Group, another major miner, in December revised its forecast spending on emissions cuts through 2030 to US$1bil to US$2bil, from a previous estimate of US$5bil to US$6bil.
“Decarbonising large industrial sectors depends on technologies that are not yet commercially viable at scale, rely on immature supply chains, or lack established markets,” Slattery said.
“Diesel displacement in large-scale haulage and fugitive emissions from coal mining remain technically and commercially difficult to address.” — Bloomberg
