Chile’s Escondida mine at night. Images: BHP
As news of the reenergised Rio–Glencore talks emerged this week, attention also turned to whether BHP could move into the top spot on the list of Australia’s most valuable listed company by market capitalisation.
BHP this week hit a 52-week high on the ASX, lifting its market capitalisation to just below $251 billion, underpinned by record prices for key metals including copper, silver, platinum and gold. By comparison, Commonwealth Bank – currently Australia’s most valuable company – was trading at around $256.86 billion.
The combined value of a merged Rio–Glencore entity could reach as high as $US260 billion ($388 billion), which would make it the most valuable mining company globally.
Copper the key
Continued demand for copper has played a major role in that value uplift for the Big Australian. But with copper also acting as a driving force for the potential Rio–Glencore deal, how would that merger impact BHP’s copper outlook?
BHP has made no secret of its ambition to be mining’s leading copper producer this century. Copper is a critical input for the technology and telecommunications sectors, and demand is widely forecast to continue growing as electrification and decarbonisation accelerate.
Following a meeting last year with US President Donald Trump and US Secretary of the Interior Doug Burgum – which was also attended by Rio Tinto chief executive officer (CEO) Simon Trott – BHP CEO Mike Henry reiterated the Big Australian’s copper ambitions.
“Copper is essential to everyday life as a critical component in powerlines, smartphones, medical equipment, cars and data centres. Demand for copper is growing strongly,” Henry wrote on LinkedIn. “The world needs more mining to build the future.”
The White House meeting was convened specifically to discuss the Resolution Copper project, recognised as one of the largest and best undeveloped copper deposits in the US. Resolution Copper is a joint venture between BHP and Rio Tinto, with BHP holding a 45 per cent stake and Rio Tinto the remaining 55 per cent.
Beyond Resolution, BHP’s global copper portfolio includes major operations in South America, including Escondida in Chile – the world’s largest producer of copper concentrates and cathodes – and Pampa Norte, which produces high-quality copper cathode.
BHP also has significant copper operations in Australia. Its wholly owned Copper South Australia business comprises the Olympic Dam, Carrapateena and Prominent Hill underground and surface operations, as well as the Oak Dam exploration project. These assets are located within South Australia’s Gawler Craton, one of the world’s most significant copper, gold, silver and uranium provinces.
Any tie-up between Rio Tinto and Glencore could see Rio gain access to Glencore’s substantial copper holdings in South America – the world’s largest copper-producing region – including wholly owned and joint-venture interests across seven major mines in Peru, Chile and Argentina.
Trott has made clear his desire to unlock Rio Tinto’s full value potential, with copper playing a key role.
“Our experienced leadership team is committed to delivering against our mission to become the most valued metals and mining company – for shareholders, the people who work with us, our partners and the communities around us,” Trott said.
That vision is being driven by a back-to-basics strategy, streamlining Rio Tinto into three core businesses: iron ore, copper, and aluminium and lithium.
A merged Rio Tinto–Glencore would significantly strengthen its copper portfolio, potentially creating the first true rival capable of challenging BHP’s long-term ambition to dominate global copper supply.
Big year for the Big Australian
The Rio–Glencore talks have added to the sense that 2026 is shaping up to be a pivotal year for BHP.
BHP has faced several challenges over the past year, including protracted negotiations with the China Mineral Resources Group on iron ore pricing. Its proposed bid for Anglo American also fell away late last year.
Another factor for BHP is the question of Mike Henry’s tenure as CEO. Industry speculation about the possibility of Henry stepping away from the role – which he took up at the start of 2020 – has prompted discussion about his potential successor.
If that were to occur, a new CEO could inherit a markedly different competitive landscape, particularly if a Rio–Glencore deal was to create a copper heavyweight capable of directly challenging BHP’s aspirations to dominance in the metal.
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