BHP has struck a US$2 billion deal for private equity firm BlackRock to take a stake in its West Australian power network.
Under the binding agreement, Global Infrastructure Partners, part of BlackRock, will provide US$2 billion in funding for a 49 per cent stake in a newly created trust entity.
BHP, meanwhile, will own and control 51 per cent of the trust entity and will pay a tariff over 25 years linked to its share.
Western Australia Iron Ore (WAIO) inland power network, which comprises four major joint ventures in the Pilbara, powers BHP’s operations in the region. It is targeting an iron ore production increase to 305 million tonnes a year, supported by investments and future growth.
BHP will retain full operational control of WAIO, including its inland power structure. The agreement will not alter existing joint venture arrangements, obligations to the state of Western Australia or the ownership of any WAIO assets.
BHP CEO Mike Henry said the agreement allowed the miner to bring in long-term capital without relinquishing control of WAIO.
“We are pleased to partner with GIP on this arrangement that enables BHP to access capital and maintain operational and strategic control of a critical part of WAIO’s infrastructure.”
BHP CFO Vandita Pant said: “This arrangement is an example of BHP’s disciplined approach to capital portfolio management.
“It strengthens our balance sheet flexibility, supports long-term value creation and enhances BHP’s shareholder value.”
BHP will incorporate and evaluate any net proceeds from the agreement in accordance with its capital allocation framework.
Completion of the deal is expected toward the end of fiscal 2026, subject to regulatory approvals.
