BHP says more stability in Chile would spur its investment
SANTIAGO - Greater financial and regulatory stability in Chile would encourage BHP Group to invest more in the country, the company's head of the Americas, Rag Udd, said on Tuesday.
"The fact is, while there are some challenges in terms of investment in climate in Chile at the moment," Udd said. "We would desperately like to resolve those challenges to help find a climate in which we can continue to invest here."
The company said it maintains plan to invest $10-billion in Chile over the 50 years, but added that the investment requires the "right fiscal certainty and right regulatory certainty."
A new mining royalty is currently being discussed in Chile's Congress and has caused strong pushback from the industry. The government has tempered the proposal, which would now currently have a total tax burden of about 48%.
Udd said the industry recognizes it can pay more than the current effective tax rate of 38% to 39%, but would like to see the new mining royalty at a rate between 41% and 44%, which would put Chile on par with other major copper producers.
Udd said the company is also "beyond open" to discussing expanding its Escondida mine, the largest copper deposit in the world, with partner Rio Tinto.
"We think it’s actually an obligation," Udd said, noting the global demand for copper in the energy transition.
Udd said that BHP is committed to supplying more copper, including with its stake in the controversial Resolution copper project in Arizona. The project has faced pushback from Native American communities.
“We’re committed to actually working with Rio Tinto and the communities in that area,” Udd said, noting that the project could supply 25% of U.S. copper demands for the next 60 years.
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