Good morning and thanks for the opportunity to be with you today.
I’d like to acknowledge that we meet on the traditional lands of the Kaurna people and give thanks for the use of their land.
When I joined Olympic Dam back in 2014, I’d heard all about this incredible orebody, so naturally thought I was coming to a world class operation. I mean, how could it be anything else – as a tier one resource of its size and part of the highly valued BHP portfolio?
So you can imagine my surprise when not long after I arrived, I realised there was a perception held by many around Olympic Dam that we were arrogant, old in our ways, incredibly resistant to change and unlikely to listen to ideas from the outside. And initially, I found it difficult to disagree with any of these perceptions!
Now some of this could perhaps be attributed to Olympic Dam’s often turbulent past, particularly given this was not long after the 2012 deferral of the planned open pit expansion. However what was patently clear is that this was not consistent with what you’d expect from a truly world class operation and that things needed to change - fast.
So, while many may have thought Olympic Dam almost ground to a complete halt once the expansion was deferred, I’m here today to tell you that we haven’t been sitting on our hands all this time. And to share a little about some of the work that has taken place away from prying eyes in our underground mine, to turn this world class copper resource into a truly world class operation.
So back to when I joined Olympic Dam in 2014. You might imagine that in a period shortly after the deferral of a major expansion, teams were downcast and unmotivated.
Rather what I was confronted with were teams who were keen to know what they could do to help and a willingness to work together to try and change. So our job as leaders became about harnessing this energy and working with our teams to bring Olympic Dam forward two decades in just three short years.
That meant taking some quick and decisive actions. We invested significant resources to review and re-design the structure of our operation. But we also spent time tackling the more intangible concepts of leadership and culture with some very deliberate actions.
In the past two years in particular, we’ve done a lot of work to change our definition of leadership, and this has been critical to our progress. While many would be familiar with the concept that a leader’s key role is to pull the levers and drive results, we have taken a different approach – focusing instead on leaders working to create the right culture, as it is this culture that will ultimately drive performance.
And this approach is getting results. An example of just one of these is the changes we’ve seen to our truck productivity.
When I joined back in 2014, I was shocked to learn that Olympic Dam had some of the worst performing truck productivity that I’d seen in any operation.
However in less than three years, our teams have done an incredible job to improve this by over 50 per cent. In a confined space such as an underground mine, this is first and foremost a great result for safety – as it means we have less trucks driving around in the same geographic footprint, so exposes fewer of our people to unnecessary risk. But is also good news for our productivity and costs.
So what does Olympic Dam’s future look like? And what does this mean for the Copper and Resources Industry in South Australia? While much has been said about the deferral of our open pit expansion, we’ve spoken little about the very significant work going on underground. But let me tell you, there’s been plenty!
In fact over the last four years, you might be surprised to learn we’ve spent in the order of A$250 million – which is arguably one of the most significant investments in South Australia’s copper industry since Olympic Dam began production in 1998. This investment in our Southern Mine Area – on horizontal development, vertical development and enabling surface infrastructure – represents the future of Olympic Dam.
For those who might not be aware, the Southern Mine Area – or SMA – is what we often refer to as the body of the guitar, given the shape of the orebody. It was also the location of the proposed Open Pit. Incredibly, since 1988 only the Northern area of Olympic Dam has been mined – or the neck of the guitar – which means a massive 70 per cent of the resource footprint is still available to be mined.
And that’s where our work has been focused – unlocking that value. But we’re doing it vastly differently to earlier proposals. We’re being very selective in how we mine, which allows us to better target higher copper grade areas. This means we will increase the tonnes we mine over the coming years, while importantly increasing the percentage copper in every tonne of dirt we move.
BHP began work on the underground expansion into the SMA in financial year 2015 and we accelerated development 12 months ago with a dedicated team of around 180 people.
So while we tend to see the expansion into the SMA as an extension of our existing operations, in reality the scale of development and investment in infrastructure and essential services like power, ventilation, telecommunications and facilities for each new mining block is equivalent to five new stand-alone underground mines.
After nearly 12 months of development preparation, Olympic Dam looks forward to celebrating the first production ore from the SMA very soon. This is class-leading result in terms of material moved and time to market - and we are incredibly proud of the team – some of whom are here today.
I mentioned earlier that half of the SMA team are new recruits. For Olympic Dam, investment in the SMA and infrastructure is important – but we know we simply cannot deliver on our plans without the right people and the right culture. When our workforce represents the communities in which we operate, we will have the right mix for success and be able to demonstrate what Olympic Dam is truly capable of.
BHP has an aspirational target of gender balance by 2025 and is the first resources company to set a goal of this kind. But it’s not just ‘pie in the sky’ thinking – our own research tells us more inclusive and diverse teams achieve:
- 19 per cent fewer recordable injuries
- 50 per cent lower turn-over
- 17 per cent greater production stability
- 24 per cent stronger leadership behaviours
Locally at Olympic Dam, I was proud to be a member of the first gender-balanced leadership team in BHP, and I have also recently had the honour of establishing our own Inclusion and Diversity Committee to continue to lead and champion this work on site.
Now while we have set some targets to increase female participation in operational and support roles across Olympic Dam – including a 70 per cent female intake for trainees and apprenticeships; 50 per cent female intake for our graduate program; and 50 per cent female across external hires – this isn’t simply about filling quotas or making preferential hiring decisions.
Fundamentally it is about making inroads to attracting, developing and retaining the most talented women to BHP – and preferably, to Olympic Dam.
And that’s why we’re taking a multi-pronged approach.
Some changes have been relatively simple – such as using different channels to reach new audiences. You may have seen our recent announcement that we’re seeking to fill 350 roles – instead of relying on traditional means such as recruitment agencies and job ads, we profiled these opportunities across stories in The Advertiser, on local ABC radio and on Channel 9. We also used social media to share video profiles of our female employees with a direct link for people to apply. These posts have received incredible engagement, reaching an audience of more than 60,000, and with some really promising results – particularly in the number of applications from regional areas across South Australia, as well as from women.
But we also have to ensure South Australia has a human pipeline of resource-industry ready potential men and women. Not just for Olympic Dam but for all of the other projects we’ll hear about today. We have to leverage the support being offered through the various channels in the Copper Strategy and the leading technical and tertiary training institutions that call SA home. We have to work together to ensure the future operators, engineers, geologists and metallurgists have access to state of the art training and technology and the skills and passion needed by our industry today and 10 years from now. And this will become an increasingly important part of our growth strategy preparation.
People capability doesn’t only apply to our workforce. For Olympic Dam to be truly successful, we need a highly skilled and cost-competitive local supply network as well. Similarly in order for South Australia’s Copper Strategy to be a true success, the State must benefit - not only through taxes and royalties, but through activation in the growth of the resource industry – creating more jobs and ploughing more investment back into South Australia.
We know we need to make it easier for companies to work with us and we need to make sure we’re connected to the right suppliers, with the right capacity for the right projects. And to do this, we need to understand the supply landscape in SA better. That’s why next week Olympic Dam is launching a new general expression of interest on the Industry Capability Network (ICN) Gateway. We are calling on new and existing companies to register their interest in providing construction services to Olympic Dam. This is the first time Olympic Dam has used the ICN to reach out to the local market and I encourage contractors in the audience today to register their interest at gateway.inc.org.au.
All things considered, Australia is incredibly well placed to support increased supply into the global market given our resource and reserves. Australian resources and reserves contain about 85Mt of Cu metal and we are the 6th largest copper producer globally. We also have a good portfolio of high quality deposits – and with approximately 58 per cent of Cu metal in the Australian deposits, there is clearly huge potential for Olympic Dam to deliver a reliable, long-term supply of copper to the world, supported by the right economic and policy settings.
In addition to the size and quality of Australia’s copper assets, our proximity to major copper markets including China, India, Japan, South Korea and South East Asia is increasingly valuable. In the near term, BHP sees new supply under development continuing to keep steady copper demand growth well covered, while in the medium to long term the trend also remains positive, as China’s future demand is fuelled by an increasingly consumption-based economy.
To fully grasp this opportunity, the State has outlined its vision to support the industry, and as well as the teaching and research institutions that will enable it.
BHP supports this focus on exploration and discovery, innovation, productivity and efficiency as well as ensuring the local and wider communities in South Australia support and benefit from the development of their resources.
Ultimately, for South Australia to achieve its ambition to triple copper production to one million tonnes per year within the next two decades, Olympic Dam will need to significantly and safely expand its underground operations with a major investment in our infrastructure and our people.
The world is watching South Australia to support future growth; and given our relatively stable legislative environment, the focus of the State Government in supporting the resources sector and promoting the Copper Strategy, we all have reason to envisage a positive future for the State’s copper industry.
And if I could quickly take the opportunity to end with a shameless plug, I’d encourage anyone who wants to be part of the Olympic Dam team to get onto the BHP website and setup a job alert – it is that simple and as I hope I’ve demonstrated today, it’s an exciting time to join!