Energy Shock Hits: Top Global Mining Executives Say Climate Agenda Will Temporarily "Take a Back Seat"

How does AI and geopolitics influence the priority of the global climate agenda?

Cailian Press, March 25 (Editor: Zhou Ziyi) According to a senior executive from global top mining company BHP Group, current energy supply disruptions will slow down countries’ efforts to reduce greenhouse gas emissions, as supply security issues are now the top priority.

BHP’s operations include large iron ore and copper mines. Geraldine Slattery, President of BHP Australia, stated in a speech, “Due to geopolitical divisions, resources and energy have shifted from traded commodities to tools of national power.”

Slattery also pointed out, “The security and affordability of resources and energy have surpassed the importance of supply chain decarbonization and have become major policy priorities for many economies.”

She added, “This shift has a real impact on investment decisions and the speed and pathways of decarbonization.”

Energy Supply Security

Conflicts in the Middle East have caused volatility in oil and natural gas markets. Shipping through the crucial Strait of Hormuz has been disrupted, some countries have restricted fuel exports, and others are turning back to coal.

Although there is evidence that consumers are increasingly purchasing electric vehicles, solar systems, and other eco-friendly products to reduce dependence on fossil fuels, the task for large corporations remains much more challenging.

It is reported that while BHP has reduced its operational emissions by more than one-third compared to the 2020 baseline, the company still faces challenges in significantly reducing diesel-powered vehicles. Last year, it told investors that spending on emissions reduction would slow before 2030, reflecting slow technological development.

Slattery said, “Large-scale decarbonization in industry depends on commercially viable technologies, mature supply chains, and mature markets, but currently, none of these are in place. Reducing diesel use in large-scale transportation and cutting carbon emissions from coal mines remain technically and commercially difficult.”

Another major mining company, Rio Tinto, has made similar moves, adjusting its forecast for emissions reduction spending from $5-6 billion to $1-2 billion in December last year.

(Cailian Press, Zhou Ziyi)