the biggest mining company in the world is Australian. And you're more than likely very familiar with them. BHP is a multinational metals and mining company headquarters in Melbourne. Operations in over 90 locations and is the largest mining company in the world based on market capitalization. They've also just lobbed in a bid for Anglo American, a $60 billion business. This could stretch the gap even further to being the absolute biggest behemoth mining company in the world. How did they do this and why are Australian companies leading the world in mining operations? let's get into it. I'm Mel Picos, and today we're talking tactics. BHP A Brief history. BHP or Broken Hill Proprietary Company Limited was founded in 1885 following the discovery of rich silver and led deposits in Broken Hill, Australia, by Charles Rasp. Initially a silver and lead mining company, BHP rapidly expanded its operations and diversified into steelmaking, oil exploration and other ventures. Through a culture of innovation and resilience. BHP pioneered groundbreaking techniques like froth flotation, revolutionizing the mining industry. It also had a significant role in one of Australia's iconic structures. The company supplied much of the steel used in the construction of the Sydney Harbor Bridge. This project showcased BHP s capabilities in steel production, and cemented its reputation as a key contributor to Australia's infrastructure development. The Sydney Harbor Bridge, completed in 1932, stands as a symbol of engineering excellence and remains one of Australia's most recognizable landmarks. Throughout the 20th century. BHP navigated economic downturns and geopolitical challenges, emerging as a cornerstone of Australia's industrial development. company played a pivotal role in achieving national energy security, With the discovery of oil in Bass Strait during World War two. BHP growth continued with strategic acquisitions and eventually to its merger with Billiton in 2001, forming BHP Billiton. Those operations, joint ventures and acquisitions continued through to the 2000 and became a global leader in resources industry, focusing on coal, iron ore, copper and petroleum. In 2013, BHP Billiton moves into their new global headquarters at 171 Collins Street, Melbourne. In 2014, operations were simplified. A number of companies spun off and the Billiton in the name was removed, And today, BHP is the world's largest mining company by market cap. But that leaves the question what is market cap? Market capitalization or market cap? Is the total value of the company's outstanding shares of stock calculated by multiplying the current share price by the total number of outstanding shares. Market cap is different to a company's total revenue or sales, or total asset value. So while BHP might not have the biggest revenue of all mining companies, it is the largest mining company by market cap. It's the main metric of valuation. If we compare BHP to another large mining company, Glencore PLC, you can see that revenue for BHP was US 65.09 billion, whereas Glencore's was 203.75 billion USD. But the market caps of each of them were US 162.05 billion, versus 76.49 billion respectively. BHP current operations BHP currently primarily operates in mining copper, which is used in everyday household products and electrification. Metallurgical coal, which is a key component in the steelmaking process. Potash, which includes a range of salts containing potassium and is used in fertilizers. Nickel, a key ingredient in stainless steel and a major component of lithium ion batteries such as those found in electric vehicles. And iron ore, one of the most sought after commodities in the world and one that is integral the steelmaking process. A few of BHP's key mining operations are Olympic Dam, South Australia. The Olympic Dam mine is one of the world's most significant deposits of copper, gold and uranium. BHP took ownership of the mine in 2005. It operates as a fully integrated processing facility from oil to metal, and is made up of surface operations, plus almost 700km of underground roads and tunnels. Newman West, Western Australia, formerly known as The Mount, while Backman Newman West, situated in the Pilbara region of Western Australia, stands as the single biggest open pit iron ore mine in the world. at 1.5km long and five kilometers wide. Combined with the Newman East site, the mines produced 257 million tonnes of iron ore in full year 2023, which is enough to make the steel for around 2980. Sydney Harbor Bridges. Minera Escondida, Chile, located in the Atacama Desert in northern Chile. Escondida stands as the world's largest copper mine based on capacity, with reserves estimated at over 32 million tonnes of recoverable copper at the end of 2012. It's operated by BHP, who owns 57.5% of the operation, along with Rio Tinto, the second largest mining company in the world, and Japanese company Chaco Corp. Anatomy of mine Peru. The Anatomy of Mines, situated in the Peruvian Andes, is one of the world's ten largest mines by production volume and one of the most profitable zinc copper mines. BHP owns 33.75% of the mine, along with Glencore, Teck and Mitsubishi, but it's operated independently by Companhia Minera and a Optima SA. The mines reserves contain vast quantities of zinc, copper, silver and lead, making it a crucial player in the international mining industry. Saroj Coal Mine, Queensland. The Saroj Mine is one of seven metallurgical coal mines located in the Bowen Basin area of Queensland, Australia, and is one of the largest coal mines in the world, with around 648 million tonnes of coal reserves. The mine's extensive reserves and efficient production methods contribute significantly BHP coal portfolio, and Australia's coal exports. Investing in tech. Something that is fascinating to me is BHP has moved to converting a portion of its haulage trucks to autonomous operation. this shift towards autonomous haulage represents a significant advancement in mining technology. Promising increase efficiency, safety and productivity. Similar to vehicles like the Teslas, these autonomous trucks have a range of sensors and use information from those sensors combined with artificial intelligence and navigation systems to navigate mining sites and transport materials with precision and reliability. BHP South Flank mine in Western Australia, completed in 2023, its conversion to an autonomous haulage fleet with 41 Komatsu 930 E haul trucks having been converted and around 185 pieces of ancillary equipment. Now able to operate within the mines, five autonomous operating zones. These trucks are also in use at BHP Gonnella coal site in Queensland. as part of the introduction of autonomous haulage at South Flank. Over 70 positions were created. There were no job losses due to this conversion, and there has been a boost in efficiency and productivity. In addition, multiple mine workers mentioned that they feel much safer working around autonomous trucks as compared to the manned vehicles. These trucks can also be remotely stopped and controlled by operators working offsite in the integrated remote operations centers. These can be based in CBDs where families can live and work closer to home, limiting the need for Fifo workers fly in and fly out. If there are potential safety hazards or a vehicle has stopped itself due to an obstruction, it has detected an operator monitoring it can log in, start or stop the vehicle, or perform troubleshooting while potentially 800km away in a different city. move to autonomous haulage underscores BHP commitment to leveraging technological solutions to drive sustainable and efficient mining practices, while prioritizing safety and operational excellence. BHP Climate responsibility. BHP is aiming for a sustainable future, focusing on decarbonization, with emissions reductions goals targeting a 30% decrease by 2032 and net zero by 2050. Despite climate challenges for shipping and steelmaking companies. They support emissions intensity reductions in those related industries. At the end of the day, BHP is a public company with over 80,000 employees and have a commitment to create value for shareholders and communities while balancing responsible development. As the world demands more resources for urbanization and higher living standards for new technology and building materials, companies like BHP are required to meet those needs. But there is a tension between resource demand and sustainability, highlighting the importance of achieving both aims. The transition from fossil fuel intensive systems to more sustainable ones is crucial, with metals playing a vital role. The challenge does lie in balancing the need for metals with energy intensive processes, such as steelmaking, for the energy transition to succeed. Even though BHP is the biggest mining company in the world, they want to get even bigger. In April 2024, they lobbed in a bid to buy Anglo American, another massive mining company. Actually the 13th biggest mining company in the world. BHP initially offered a deal worth around about $60 billion to buy the company. Anglo rejected this offer. BHP then up to their offer, but once again, Anglo rejected this bid of $64.4 billion. And then BHP made a third offer. The company really wants to buy Anglo, it seems, and its offered $73.9 billion to buy them out. And once again, Anglo Borden shareholders turn this offer down. But the door is open for BHP to sweeten the deal, and they may still be successful in taking over Anglo American. BHP wants to boost its already world leading reserves of copper, and wants to get its hands on Anglo-Americans copper assets, as well as its coal and iron ore businesses. if this takeover bid is eventually successful, BHP would stretch its lead at way ahead of any other mining company. It's still in negotiations as I'm making this video, so by the time I release it, the deal could be done. And BHP might have become the behemoth of the mining industry. Why do Australian companies do so well in mining? I want to finish this video with a final question. BHP, an Australian company started by seven people in Broken Hill in 1885, has become the largest mining company in the world. The second largest company by market cap is Rio Tinto, another Australian mining company. Although Rio is British Australian, now. And looking down this graph of largest mining companies, another Aussie, Fortescue Limited, is sitting at number nine. And the richest person in Australia, Gina Rinehart, has amassed her fortune in the mining sector. In fact, quite a number of the richest 50 Australians made their money in mining. Why is it that Australian mining companies are performing so well amongst massive players like the United States or China? The way I see it, it comes down to four points. Abundance of natural resources Australia boasts abundant reserves of valuable minerals and oils. We lead the world in production of iron ore, natural gas, lithium, gold and cobalt and have several of the largest reserves in the world of iron ore, zinc and cobalt. These resources are high in demand globally, making Australia a lucrative destination for mining investments. Geopolitical position. Australia's geopolitical position, culturally linked to Western nations but economically tied to Asia, has strategically positioned it as a reliable trading partner. Mining exports to Asian countries like China, South Korea, Japan, Singapore and Hong Kong all places that have either large manufacturing industries, low natural resources or both contribute significantly to Australia's economy and allow those businesses to thrive here. Scientific research and development. Government funded research in mining technology enhances our industry's efficiency and profitability. Organizations like the CSIRO invest in exploration, mineral processing and environmentally sustainable mining practices, ensuring Australia remains a global leader in mining innovation. Economic significance. Mining is Australia's largest contributing sector, to the economy responsible for over 10% of GDP. The industry has recorded growth even during Covid 19 pandemic, making it one of the most resilient sectors. Of course, it also turbo charges other industries. Australian mining operations can take advantage of these factors and become some of the biggest mining companies in the world, as seen by BHP, rose. But what do you think? Are you impressed by how BHP has risen to become the largest mining company in the world, and one of the biggest companies in Australia? Is there another reason why you think Aussie mining companies, some of the biggest in the world. Is there another Australian company that you'd like us to take a look at? Let me know in the comments section down below. And don't forget to like and subscribe so you don't miss the next video. Thanks for watching. I'm Mel Pikos and we've been talking tactics. Yes. Me. Oh, no.