Global mining giant BHP Group Ltd has set its sights on Botswana’s copper resources following a failed £38.6bn bid for Anglo American. Reports indicate that “The primary motivation for the deal (was) BHP’s desire to obtain Anglo’s copper mines.” They also indicate that copper demand and prices are expected to surge as global demand shifts away from fossil fuels.
On its website, BHP states that it is mining copper because; “We believe that demand for copper will grow due to grade declines at existing copper mines, the radical urbanisation of large populations in China and India and the electrification of energy and transportation.” It says “The rise of renewable energy sources such as wind and solar require copper for their infrastructure.”
Now in what is seen as a strategic move, BHP is now negotiating an exclusive joint venture agreement with Cobre Limited over its Kitlanya Copper Projects, located within the Kalahari Copper Belt.
Cobre Limited announced the execution of a letter of intent with BHP’s wholly-owned subsidiary to formalise talks for a significant earn-in agreement on its Kitlanya West and East projects. These projects are positioned on the northern and southern margins of the highly prospective Kalahari Copper Belt, an area that has drawn increasing attention from international mining companies due to its rich copper and silver deposits.
The Kitlanya Projects, owned by Cobre, represent a crucial opportunity for BHP to strengthen its presence in Africa’s mining sector, with Botswana emerging as a key player in the continent’s copper production. Reports further indicate that Copper demand has surged globally, driven by the metal’s essential role in the transition to clean energy technologies such as electric vehicles and renewable energy infrastructure.
The Proposed Transaction follows on from Cobre’s successful participation in the BHP Xplor program which also provided funding for the recently completed seismic survey on the Kitlanya West project (see ASX announcements of 23 January 2024 and 22 August 2024)
Cobre said the Proposed Transaction underscores its confidence in the potential for its projects to host Tier 1 copper-silver deposits. It says a partnership with “BHP would provide the exploration scale and expertise to maximise our chances of making significant new discoveries on our basin margin exploration ground while retaining 100% ownership of our Ngami and Okavango Copper Projects which are excluded from the Proposed Transaction.”
The Proposed Transaction is subject to approval and execution of formal binding documents and the completion of BHP’s due diligence investigations within the exclusivity period. Final details of the Proposed Transaction will be released to the market following completion of the long-form documents.
Commenting on the Proposed Transaction, Cobre’s Chief Executive Officer, Adam Wooldridge, said successful negotiation and completion of this “significant transaction with BHP, one of the world’s
leading mining companies, will be a major moment in time for Cobre as a company.” He said participating in the BHP 2024 Xplor cohort has provided the opportunity to do a belt scale review of the Kalahari Copper Belt, culminating with the collection of seismic data over the prospective northern margin of the belt.
“The Proposed Transaction with BHP would allow us to fully fund our follow-on exploration programmes and focus on discovering the Tier 1 deposits we believe may be hosted in our Kitlanya West and East Projects,” said Wooldridge.
