BHP experts have provided insights into how artificial intelligence will drive global copper demand.
BHP hasn’t been shy about its desire to dominate the global copper market. The major has made its belief in the longevity of copper clear and put some serious plays into practice over the years to establish its global footprint.
The Escondida copper mine in Chile is perhaps the most significant example of this.
BHP is the majority owner of Escondida, touted to be the world’s largest copper mine, through a joint venture with Rio Tinto.
In 2024, the mine achieved a 10-year production milestone, with over 644,000 tonnes extracted in the second half of the year alone.
BHP has also established a copper province in South Australia consisting of four projects that are known for holding major deposits with global significance.
Olympic Dam has operated under the BHP banner since 2005 and boasts almost 700km of underground roads and tunnels, though it also includes a surface operation.
Around 65km to the east lies Oak Dam, an exploration project that has seen BHP target deposits deep underground, while 650km northwest of Adelaide, BHP’s Prominent Hill mine produces copper ore from its Ankata and Malu underground stoping mine areas.
Less than 200km south of Prominent Hill is the Carrapateena operation, which has been part of BHP’s portfolio since 2023 and has an annual output of 4.25 million tonnes per annum.
The Big Australian has other copper projects across the world, too, including Pampa Norte in Chile, Antamina in Peru and Resolution Copper in Arizona, US.
This global footprint is expected to continue growing in the coming years, and the world’s hunger for copper is expected to grow with it.
BHP recently weighed in on where it thinks this demand will come from.
In a report titled ‘Why AI tools and data centres are driving copper demand’, BHP experts laid out a future copper landscape beholden to emerging technology.
“Copper is vital to support the rapid growth in data centres around the globe that are enabling us to embrace new artificial intelligence (AI) and generative AI (GenAI) technology,” BHP said in the report. “AI and GenAI tools are transforming the way we work, create and interact.
“Whether it’s Microsoft Copilot, OpenAI’s ChatGPT, Google’s Gemini and Dall-E or the incorporation of AI functionality in already widely used applications such as Microsoft’s Word and Adobe’s Photoshop, interest has boomed in recent years.”
Anyone with a smartphone will be aware that AI-powered voice assistants have become increasingly popular, and large enterprises are becoming more interested in using AI to solve business challenges.
BHP said it’s easy to understand why, as AI tools can offer potential efficiency gains in work and daily life and can help explore and develop new concepts and ideas.
“But for all their strengths, they are only as good as the processing power behind them,” the company said. “In this partnership, AI technology may be the brains, but data centres provide the brawn.
“AI-powered tools require super-fast data processing and data storage and retrieval capability to handle the resource-intensive training and deployment of the complex machine learning models and algorithms that make them work. Data centres provide this rapid computational muscle.”
A data centre is a facility that hosts computer servers connected through high-speed networks. They enable the rapid collection, processing, storage and retrieval of data required to effectively process complex AI machine learning algorithms.
The construction of these data centres has been on the rise over the last decade as companies try to keep pace with digitisation.
According to BHP, the number of hyperscale data centres worldwide doubled from 448 to 992 between the years 2018 and 2023
“This data centre demand was driven by the computational applications, storage consumer applications (such as Netflix) and ongoing enterprise adoption of cloud,” the company said.
“For example, when your phone backs up to the cloud, it is essentially storing the information in a data centre or a range of data centres somewhere around the globe for whenever you next need it.”
According to Macquarie Data Centres, AI requires 10 times the resource requirements of the cloud, meaning more data centres are required to keep pace.
But where does copper factor in?
BHP said data centres rely on copper for their construction and operation, including:
in the chips, wiring, busbars and power connectors in the servers themselves
in the cooling systems and the servers
for the transmission cables and power connections across the data centre
for the external cabling to deliver power to the data centre
in the infrastructure used in generation of the power required to run them, particularly if this power is derived from sources such as solar or wind.
A study of Microsoft’s $US500 million data centre facility in Chicago found it used 2177 tonnes of copper.
“Data centres also need large amounts of power to function,” BHP said. “Both the generation of this power and its delivery to the data centre require copper.
“According to the IEA (International Energy Association), large hyperscale data centres, which are becoming increasingly common, have power demands of 100 megawatts or more, an annual electricity consumption equivalent to that used by around 350,000 to 400,000 electric cars.”
BHP foresees this rapid growth will form a solid foundation on which it can rest its copper supply.
“We estimate the copper used in data centres globally will grow six-fold by 2050 – from around half a million tonnes a year of copper today, to around three million tonnes a year by 2050,” the company said.
“That uplift is roughly equivalent to the combined annual output of the world’s four largest copper mines today. We also expect global electricity consumption from data centres to rise from around two per cent of total global electricity demand today to nine per cent by 2050.
“In some countries this proportion is already higher – for example in Ireland, data centres already represent a fifth of the country’s total electricity consumption.”
BHP produced 987,000 tonnes of copper across its operations in the second half of 2024, an increase of 10 per cent on the previous half.
In its half yearly report ending December 31, 2024, BHP chief executive officer Mike Henry said the company’s copper assets are in good stead to continue their upward trajectory.
“We are well positioned to continue strong momentum into the second half with a number of assets now expected to deliver production in the upper half of their respective ranges, while maintaining tight cost control,” Henry said at the time. “BHP is in good shape and we have a clear pathway for growth.”
Last year, BHP outlined a pathway to increase copper production in South Australia to more than 500,000t of refined copper cathode a year by the early 2030s, and a strategy to deliver up to 650,000t from the mid-2030s – up from around 322,000t last financial year.
In February, BHP locked in a downstream processing deal that will see the expansion of its copper smelter and refinery facilities in South Australia.
BHP Copper SA asset president Anna Wiley said the state is central to the company’s copper plans.
“BHP is building momentum in South Australia, and this is another step forward in our strategy to increase the production of SA’s high-quality copper resources to support the global energy transition,” Wiley said.
“BHP has established a world-scale copper province in South Australia and we are working at pace to progress our plans to lift production further over the coming decade.”
With data centres cropping up across the globe and AI becoming more powerful and widely used, BHP can be confident in its projections of a copper-heavy future.
Whether in South Australia, Chile, or from another of its copper assets, the Big Australian is determined to rise to meet the oncoming demand.
This article appeared in the Winter edition of Mining Magazine.
