BHP has entered a $US2 billion ($A3 billion) agreement with Global Infrastructure Partners (GIP), part of BlackRock, bringing new capital into its Western Australia Iron Ore (WAIO) inland power network.
Under the binding agreement, a new trust entity will be created, 51 per cent owned and controlled by BHP. GIP will provide $US2 billion in funding for a 49 per cent stake. BHP will pay the entity a tariff over 25 years linked to its share of WAIO’s inland power usage.
“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 chief executive officer Mike Henry said.
WAIO, which comprises four major joint ventures in the Pilbara and is 85 per cent owned by BHP, will continue to operate unchanged.
BHP said the deal does not alter existing joint venture agreements, obligations to the State of Western Australia, or ownership of any WAIO assets, including the inland power infrastructure.
The transaction highlights BHP’s growing use of external capital structures to support long-term Pilbara iron ore expansion, a strategy the company has increasingly deployed across non-core infrastructure.
WAIO continues to pursue its long-term plan to increase production to 305 million tonnes per annum through targeted investment and retained optionality for future growth.
“This arrangement is an example of BHP’s disciplined approach to capital portfolio management,” BHP chief financial officer Vandita Pant said. “It strengthens our balance sheet flexibility, supports long-term value creation and enhances BHP’s shareholder value.”
Completion is expected towards the end of the 2026 financial year, subject to certain regulatory approvals including Foreign Investment Review Board approval.