BHP poised to sign off-take deals for Iberdrola's Aussie wind-solar giant

Mining giant BHP Group (ASX:BHP) announced today it is gearing up to sign “bespoke” deals with Iberdrola Australia to buy power from the 317-MW Port Augusta wind-solar complex in South Australia.

The renewable energy supply arrangements, which the mining group expects to enter “shortly,” are aimed at cutting the emissions at its Olympic Dam copper, gold and uranium mine in the Aussie state. BHP estimates that the deals will slash emissions from the electricity supply to Olympic Dam by half by 2025.

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Iberdrola Australia said separately it has been selected as BHP’s green energy partner for the Olympic Dam site.

In line with this commitment, BHP will take power from the Port Augusta Renewable Energy Park that the unit of Spanish utility Iberdrola SA (BME:IBE) is building in the Aussie state. The AUD-500-million (USD 368.6m/EUR 318.5m) complex will pair 210 MW of wind power capacity with 107 MW of photovoltaic (PV) capacity and is expected to be fully commissioned in July 2022. BHP will be the primary power off-taker.

The power supply agreements will be facilitated by Australian electricity and natural gas company Origin Energy Ltd. They are planned to come into effect on July 1, 2022.

BHP has set a goal of cutting the Scope 1 and 2 emissions from its operated assets by at least 30% by fiscal 2030 from fiscal 2020 levels. This summer, the miner expanded to 50 MW an existing power purchase agreement (PPA) to back the needs of its Kwinana refinery in Western Australia.

(AUD 1.0 = USD 0.737/EUR 0.637)