Bhp Group Ltd · ASX:BHP
Bhp — ESG Presentation (September 2020)
41 slides from Bhp's sustainability presentation, Sep 10, 2020
Slide 1: Building a better world: Climate change briefing
BHP Building a better world Climate change briefing 10 September 2020
Slide 2: Disclaimer
Disclaimer BHP Climate Change Report 2020 This presentation should be read in conjunction with the BHP Climate Change Report 2020 available at bhp.com. The information in this presentation provides a concise overview of certain aspects of that Report and may omit information, analysis and assumption
Slide 3: Building a better world - Mike Henry
Building a better world Mike Henry Chief Executive Officer
Slide 4: Accountability, expectations and value
Accountability, expectations and value We take climate change seriously and are demonstrating leadership in addressing it • Emissions are created in production, transport and use of Demonstratingour products Accountability •We have a role to play in addressing climate risk •We embrace our responsibi
Slide 5: Clear requirements drive better outcomes
Clear requirements drive better outcomes We hold ourselves to clear requirements in determining the actions we take on climate Actions of Substance • Contribute to actual and meaningful emissions reduction • Supported by well thought through plans Clear in our Focus • Reduce emissions that we contro
Slide 6: Our purpose
Our purpose To bring people and resources together to build a better world BHP
Slide 7: Our resources are essential to daily life
Our resources are essential to daily life Our industry must grow if the world is to decarbonise while continuing to improve living standards Cumulative demand to 2050 (Compared to prior 30 years, 1.5oC scenario1) traditional plus emerging Future facing commodities: Stainless steel, refrigerators, co
Slide 8: Leading with action
Leading with action Substantive and measurable 1 A mid-term target to reduce operational greenhouse gas (GHG) emissions by at least 30% from FY2020 levels2 by FY2030 Scope 3 actions to enable decarbonisation in our value chain •steelmaking: support industry to develop technologies and pathways capab
Slide 9: We continue to take action
We continue to take action Committed to supporting decarbonisation of our industry Collaborating to solve problems and lower emissions across our industry Renewable power contracts 100% renewable energy in Escondida and Spence assets by mid-2020sPath to zero power emissions by 2030 for our Queens
Slide 10: Strategy and capital allocation - Johan van Jaarsveld
BHP Strategy and capital allocation Johan van Jaarsveld Chief Development Officer
Slide 11: Climate change is core to everything we do
Climate change is core to everything we do Consideration is critical to maximising value and returns Our Strategy is to have the best commodities, the best assets and the best culture and capabilities. We incorporate climate change scenarios into our strategic choices to guide our strategic directio
Slide 12: Our portfolio is tested across a range of futures
Our portfolio is tested across a range of futures We use scenarios to consider opportunities and risks3 Value 1.5°C Scenario Decarbonisation • Swift decarbonisation of power of stationary • Rapid electrification of all end power use sectors Lower Carbon View • CCUS required for offsets and heavy ind
Slide 13: What does a 1.5 degree transition look like?
What does a 1.5 degree transition look like? Paris Agreement goals met through large-scale changes to the global energy, industrial and land-use systems Total primary energy demand3 Energy-related CO emissions 2 (Btoe) (Gt CO2-e) Today 2050 20 36 Emissions (RHS) Fossil fuels in the Approximately 80%
Slide 14: Most of our commodities benefit in a decarbonising world
Most of our commodities benefit in a decarbonising world As decarbonisation accelerates the world will require more copper, nickel, potash and steel 1.5°C Scenario Central Energy View Cumulative demand in the next 30 years compared to the last 30 years Lower Carbon View (%) Oil demand outlook (%, in
Slide 15: Managing our portfolio for value, risk and returns
Managing our portfolio for value, risk and returns Climate change is embedded in our strategic decisions Best Commodities Best Assets Best Capabilities • Growth in future facing commodities; • Expandable assets, particularly in growth • Commercially minded growth capabilities; specifically copper, n
Slide 16: Amongst lowest operational emissions intensities
Amongst lowest operational emissions intensities Our operated assets are well positioned and are set to continue reducing carbon emissions PPAs in Chile will deliver significant benefits Renewable power will improve Nickel intensity Our Petroleum business is well positioned Tonnes CO2-e per tonne of
Slide 17: Disciplined assessment of decarbonisation opportunities
Disciplined assessment of decarbonisation opportunities • Our Capital Allocation Framework enables us to align investment with our strategy and to respond to emerging risks and opportunities • Climate-related forecasts (including carbon pricing) are incorporated into life of asset and project evalua
Slide 18: Our Climate Investment Program supports decarbonisation
Our Climate Investment Program supports decarbonisation 10 September 2020 Climate change briefing 18 US$400m Five-year Climate Investment Program (CIP) (announced in July 2019) Applied now in operated assets Future technology optionality Carbon offsets Applied to support value chain emissions reduct
Slide 19: Managing climate risks and opportunities - Fiona Wild
Managing climate risks and opportunities Fiona Wild VP, Sustainability and Climate Change BHP
Slide 20: Our mid-term target, aligned with the Paris Agreement
Our mid-term target, aligned with the Paris Agreement Our long-term goal • To achieve net-zero operational emissions by 2050 Our new mid-term target • To reduce our operational emissions by at least 30% from FY2020 levels15 by FY2030 • This target falls within the range of emissions reductions requi
Slide 21: The pathway to net zero operational emissions
The pathway to net zero operational emissions 10 September 2020 Climate change briefing 21 Timeframes to reduce emissions from electricity and diesel will differ, with the latter reliant on technological advancement 40% Electricity Diesel displacement Other FY2020 operational emissions Note: Graph i
Slide 22: Renewable electricity lowering costs and emissions
Renewable electricity lowering costs and emissions • 3 Mt CO2-e per annum reduction from FY2022 – reduction in absolute BHP operational emissions by ~15% • 20% reduction in procured electricity prices; NPV positive 10 September 2020 Climate change briefing 22 Power agreements will deliver ongoing em
Slide 23: Diesel displacement is being advanced on multiple fronts
Implement and scale Trial technology and improve Diesel displacement is being advanced on multiple fronts 10 September 2020 Climate change briefing 23 Estimating electricity requirements of material movement and greening underlying power Materials handling and mine planning studies on options such a
Slide 24: Addressing Scope 3 emissions
Addressing Scope 3 emissions 10 September 2020 Climate change briefing 24 Supporting emission reductions across our value chains through partnership FY2021 actions 2030 goals Long-term vision Processing and use of sold products ,· Two partnerships with customers in the steel-making sector ,· Additio
Slide 25: Partnering to address Scope 3 emissions
Partnering to address Scope 3 emissions • The International CCS Knowledge Centre, founded by BHP and SaskPower, seeks to accelerate CCUS via shared learnings • The Knowledge Centre has released a ground-breaking study of second-generation CCUS, demonstrating large cost savings • The Knowledge Centre
Slide 26: Strengthening the link to executive remuneration
Strengthening the link to executive remuneration 10 September 2020 Climate change briefing 26 Climate change is a material governance and strategic issue 5 year total shareholder return performance relative to peer groups • Reductions in operational GHG emissions • Short and mid-term actions to redu
Slide 27: Transparency and disclosure are key
Transparency and disclosure are key • We have a record of sector-leading climate-related disclosure: ISS QualityScore—top ranking TPI—one of only 8 companies to receive the top rating of 4* CDP—score of A- • We were one of the first companies to align with the recommendations of the Task Force on Cl
Slide 28: Conclusion
Conclusion Well positioned Clear and ambitious plans Options for substantial value
Slide 29: Appendix
Appendix BHP
Slide 30: Social value drives our competitive advantage
Social value drives our competitive advantage 30 Social value protects our business today and positions us to take advantage of future opportunities S O C I A L V A L U E Best commodities Best assets Best culture and capabilities Access to resources  Obtain and retain rights to operate and expand
Slide 31: Social value scorecard
Social value scorecard 31 Safety & Health Fatalities 1 0 0 0 Zero work-related fatalities High Potential Injury (HPI) frequency (per million hours worked) 0.31 0.32 0.14 0.24 Year-on-year improvement of our HPI frequency Total Recordable Injury Frequency (TRIF) (per million hours worked) 4.7 4.6 3.7
Slide 32: Climate change scenarios
Climate change scenarios 10 September 2020 Climate change briefing 32 Our portfolio is tested across a range of futures 1.5 degrees Lower Carbon View Central Energy View Climate Crisis Total primary energy demand (Btoe) Fossil fuel share of power generation Electrified LDV fleet CCUS Carbon Price Pa
Slide 33: Continuing to thrive in a decarbonising world
Continuing to thrive in a decarbonising world 10 September 2020 Climate change briefing 33 Active portfolio management will maximise upside FY20 FY30 FY40 FY50 Rolling present value7 relative to Central Energy View Relative value over time Net operational emissions forecast Central Energy View Lower
Slide 34: Portfolio of operational decarbonisation solutions
Portfolio of operational decarbonisation solutions • Broad portfolio of opportunities across our operated assets • Projects are prioritised at a Group level to deliver optimised outcomes based on ease of implementation, impact to operations and technology readiness in addition to financial metrics •
Slide 35: Strong track record in reducing operational emissions
Strong track record in reducing operational emissions Our short-term target • By FY2022, maintain our operational emissions at or below FY2017 levels3, while we continue to grow our business FY2020 Performance • The majority of our operational emissions came from electricity procurement and self-gen
Slide 36: Scope 3 emissions FY2020
0 100 200 300 400 Purchased goods and services (including capital goods) Transportation and distribution Other Iron ore processing Copper processing Metallurgical coal Energy coal Crude oil and condensates Natural gas and Natural gas liquids Scope 3 emissions Scope 3 emissions (high-end estimate) Sc
Slide 37: Our support for natural climate solutions started in 2013
Our support for natural climate solutions started in 2013 10 September 2020 37 Climate change briefing NCS represent one of the most cost-effective, ready solutions to mitigating climate change while also providing a host of co-benefits • Investment in Valdivan Coastal Reserve (first carbon project
Slide 38: Adaptation: managing physical climate risk
Adaptation: managing physical climate risk 10 September 2020 Climate change briefing 38 Our approach is to consider risks across our operations, value chain, portfolio, communities and ecosystems Production inputs / infrastructure (controlled) Acute risk: Storm intensity at coal port • Increasing st
Slide 39: Footnotes
Footnotes 1. Slide 7: To stay within a carbon budget that keeps global warming to no more than 1.5°C, the 1.5°C scenario requires steep global annual emissions reductions, sustained for decades. This pathway to 2050 represents a major departure from today’s global trajectory. 2. Slide 8: FY2020 base
Slide 40: Appendix footnotes
Appendix footnotes 1. Slide 31: FY2019 presented on a total operations basis, except for operational GHG emissions, fresh water withdrawals and local procurement spend. 2. Slide 31: Operational GHG emissions have been revised subsequent to the FY2019 annual report following an HSE data audit, result
Slide 41: BHP
BHP SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. BHP Group Limited and BHP Group Plc Date: September 10, 2020 By: /s/ Caroline Cox Name: Caroline Co