We are honored to welcome to the stage Shannon Ruska from Tribal Experiences.
So it's something our mob's been doing since the beginning of time, and there's different methods, and each different Aboriginal family has a method. How do I know this? My great-grandfather, Mokkan, was a fully initiated man with the scarifications on his chest, and he was a messenger man. And his responsibility was to carry these message sticks that had paintings or carvings on, and it gave reason why our particular family was traveling from one Aboriginal nation to another. If you don't know, there's over 300 different Aboriginal nations in Australia, and let's just take a small journey around. We divide the nations via the language groups. And for here in Jagera, repeat it after me, we say Biki, like Biki and Ti for hello. Biki. Well done.
If we go in a boat and we travel out to North Stradbroke Island, if you haven't been there before, good to take the family. I'm not trying to promote it for tourism or anything, but it's a beautiful place to take the family. It's like you're hidden away, but the city's right there. Anyway, but if you go there swimming at the beach, the mob meets you there. They're going to ask you to be greeted with the word, repeat it after me, Yura. Well done. Now, if we paddle on up in a couple of canoes from there, and we go past Bribie Island up to Maroochydore River or Maroochydore, Maroochydore means a black swan, and if we go there, the mob will greet us with the word, Wanya. Well done. We leave the canoes there because we, as Aboriginal people, are very communal people.
So when mob comes, that's why you see about 20 or 30 of us in a house at once sometimes, you know. When mob comes, we open our doors, we open our cupboards, have food, and we open, if they need to go to the shop in their cars or go visit other families, they'll borrow those as well. And that's how we are. So we leave those canoes there at the Maroochydore River because one day they're going to paddle back our way, and they'll leave it here. So we leave them, we go over the Blackall Ranges to my wife's country. She's from Cherbourg, Nanango, Kingaroy, places like that, and that's the Wakka Wakka people. They'll greet you with the word, repeat it after me, Yanande. Well done.
So we leave that, and there's a motor show on down at Ipswich, and when we get to Ipswich, they'll 25 minutes from here, if you're not speeding. Anyway, 25 minutes from here and Ipswich, they'll say, "Yanma. Well done." Now, as you can see, in about a 100-kilometer radius for us mob, that language changes. Very different. If you pick up a map of Europe and you smash it into a map of Australia, it's still not enough countries and languages. We are very multicultural, you may as well say, amongst our Aboriginal nations throughout, from top to bottom. Now, the process is to carry those message sticks over, just like you use in the modern day, a passport or visa. Maybe you got the idea from us.
I said to the elders one day, just off the track. I said to the elders, sitting down having a cuppa, and it dawned on me. I said, why didn't you patent the message stick format? We'd be billionaires, right? Anyway, it's worldwide now. But so the message stick goes and seek the permission. Once they say, yes, come over, like at the border control, more or less, but in the village, they'll say, yes, all right, you can come over. The messenger man comes back and says, hey guys, pack your swags, we're heading over. Pack your bags for the internationals, that means. A swag is a bag. So we go on over to their area and we'll stay there. When we arrive there, the law's laid down, what we can and what we can't do in the country, just like any other nation you visit in the world.
And then after the law is laid down, we're allocated different areas. So when people would visit from the north, they were given the Normanby Hotel up there, just up the road. They were allocated that area to be able to camp and live and hunt. When the mob from the south would come, they were given all Coorparoo along with the mob from the east, just over the south side of the river. When the mob from the west would come, far west as well, out near in Kingaroy country and that, Nanango and that, when they would come up, they were given around South Brisbane. So hence why there's still a population moving around in that region now, over those generations. And for us, we're able to allocate anywhere we wanted in our country. So once the allocation was done, the law was laid down.
We always did song and dance. And song and dance was very important. And I won't keep you much longer, but song and dance was important because when you went to school, who went to kindergarten? Anyone? Who went to school? Anyone learn a song? It might be from some of your elders. It goes like this. A, B, C, D, E, F, G. Your elders taught you that when you were little, right? When your elders taught that, it was subconsciously drummed into the back of your head for phonetics, wording, and all that when you got older. Didn't realize that when you were singing it, hey? But now, until nearly the day that you die, you're going to remember that song. And so our elders did the same thing with the songs and dances. That's why you see that at the stadiums and everywhere else.
Just on a small note, I'll just finish off. My uncle, I'm a singer of the tribe. And I wasn't always a singer. When I was younger, my uncles, we all used to go from a little place called Inala. Aboriginal, a lot of Aboriginal lived in that community. And we used to go across to Stradbroke Island. And when we went to Stradbroke Island, in the last hut at a place called One Mile, it's called One Mile because it's one mile from the boat. And when you get up to the last hut, my uncle used to live in it. He was a storyteller of the tribe.
So we'd sit down and he'd have the fire lit, and all the kids would sit around the fire and he'd tell these stories about the Bunku, the stingray, Wop yet, the turtle, the Kabul, the carpet snake, and the list went on. And I thought, if this old man knows a story, he must know an old Aboriginal song. I wanted to hear some. And so I walked up to him at the end of the storytelling. Everyone was going home, and I tapped on his shoulder, reached up, "Uncle, do you know any songs?" And he said, "Yeah, boy, I know one, but you're not ready yet." And I didn't understand. I'm a kid, right? And I walked back to the car, jump in with Dad, and I said, "See Uncle," went back to Inala.
I said, "Dad, oh, you know, Uncle never showed me." He said, "Because when you start learning words like a university, you never stop learning." And so when I went back the next time, he said, "Just don't ask, let the elders bring it to you." And that was the way that things happened. And so when I went back the next year, at Easter time, fire lit, he's telling the stories, Kangaroo, Murri, all the different stories. And then anyway, I started to leave, and I felt this tap on the back of my shoulder. I looked around like this, and it was Uncle, old Uncle. And old Uncle said, "You ready to learn that song yet, boy, that dance?" I said, "Yeah, Uncle, I'm ever ready." And so I was so excited, right?
I'm nine years old, and just like my uncle, I'll get everyone just to stand on their feet. We'll stand on your feet if you can. Right now, let's have a little bit of storytelling. Here we go. Now, Uncle said, I said, What do you do? What do you do? And Uncle said, Slow down, boy. And my dad said, When the elders speak, you just listen. They're the wise one, you know nothing. Even if you heard it before, don't keep talking. Let them talk because they might teach you something a little bit different too that goes with that story. Anyway, so, but I was, you know, just so excited. Uncle, what do I do? He said, All right, put your arm like this. Can everyone put their arm like this, just across their chest? That's it. I said, What's next? What's next?
And I'm looking out like this. Boy, slow down. You listen to me. And he said, Okay, okay. I said, Put your hand like this. So everyone put your hand like this. I said, What's it like Maroochydore? Maroochydore, the black swan, he said, a little bit like that. It's called Amaleta. Can you all say Amaleta? All right. So I said, Is there a song? He said, Yeah, there is. I said, What are we doing next? He said, Boy, you talk too fast. Just stomp your right foot. Everyone, stomp your right foot. Here we go. Stomp, stomp, stomp. Here we go. And he started to sing. Where's the song, Uncle? He said, Oh, here it is. Here you go. Ready? And he went, Amaleta, Amaleta, Amaleta, Amaleta, Amaleta tea pot short and stout. Ladies and gentlemen, we're serious people.
You break down our barriers just like you will have some fun. Thank you and welcome. Have a great gathering.
Ladies and gentlemen, my name is Ken MacKenzie, and I'm your Chair. Hello and welcome to BHP's 2024 Annual General Meeting. First, let me thank Shannon Ruska for that warm Welcome to Country. He is going to be a very hard act to follow. I would like to acknowledge that these are the traditional lands of the Jagera and Turrbal people who have a deep connection to the lands and waterways of Brisbane. We extend our respect to their elders past and present, and welcome to you, our shareholders. Now, we are delighted to be together in person in Brisbane today. The last Annual General Meeting we had in Brisbane was in 2016, and I have to say it's been too long. You know, I think COVID got in the way.
It sort of delayed things for a couple of years, but we're really pleased to be back. We've got 100,000 Queenslander shareholders in this state that hold over 170 million shares. So it's a real, aside from the operations that we have here, it's a really important destination for us. Now, today I'm joined on stage by my fellow directors, including Chief Executive Officer Mike Henry and our Group Company Secretary Stefanie Wilkinson. We also have our external auditors from Ernst & Young and our Chief Financial Officer, Vandita Pant, who's in attendance as well as members of our executive leadership team. Now, a special welcome to Ross McEwan and Don Lindsay, who are joining their first BHP AGM as directors. Ross and Don are both seeking election at the 2024 AGM, and the remaining directors will seek re-election in line with our policy for annual director elections.
I'd also like to take this opportunity to acknowledge Ian Cockerill, who retired from the board in April 2024, and Terry Bowen, who retired in October 2023. Now, I can confirm that there is a quorum present, and as the time is shortly after 10:00 A.M. in Brisbane, we can now start the meeting. The notice of this Annual General Meeting was made available to shareholders on the 23rd of September 2024, and I'm going to take it as read. The poll is now open for all of the items to be considered at today's meeting, and you may now start casting your votes. I'll also give you a warning before the end of the meeting to ensure that you're able to cast your votes. Our Group Company Secretary, Stefanie Wilkinson, will outline the procedures for voting at today's AGM later in the meeting.
So again, welcome to everyone with us here today in Queensland and watching the webcast online. As I said, we're proud to have around 100,000 shareholders in Queensland who hold over 170 million shares, and it's good to have many of you joining us here today, and of course, Queensland is also home to around 10,000 BHP employees and contractors, as well as our partnership with Mitsubishi in the BMA joint venture. BMA is a great business, and Queenslanders can be proud of the high-quality steelmaking coal it produces for customers in India, Japan, South Korea, and China. Ladies and gentlemen, it's a privilege to be here to address you as the Chair of BHP. Now, I've chaired several BHP Annual General Meetings now in different cities in person and online through COVID, and I'm always left energized by your passion for and interest in the company.
Stewarding BHP is an honor that your board and I and our executive leaders take extremely seriously, and we understand that it's the combination of outstanding people, world-class assets, and execution excellence that gives BHP the opportunity to create long-term value for our shareholders and for the communities in which we all live. In these areas, we believe your company continues to set itself apart, and we hope you are all as confident and excited about the future for BHP as we are. Financial year 2024 was a strong one. We performed well financially and made solid progress on our social value targets and goals. And we showed once again that the consistent execution of our clear and simple strategy delivers results. And BHP is well positioned to continue to create value today and for decades to come.
I'd like to take this opportunity to explain why, focusing on four fundamentals: a safe, inclusive, and productive workplace culture, a portfolio of world-class assets and attractive commodities, disciplined capital allocation, and the creation of social value. I want to start with safety. In January, a team member with one of our contracting partners here in Queensland lost his life at work. Now, Luke O'Brien's death was a tragedy, and our thoughts remain with his family and colleagues at BMA. We must eliminate fatalities and serious injuries from BHP, and nothing matters more than safety. Further, we remain determined to eliminate sexual harassment, racism, and bullying in our workplace. We know diverse and inclusive teams are safer, they're more productive, and that's why we are working to make BHP a place where everyone can bring the best of themselves to work.
Now, the board saw this spirit firsthand when we visited our potash project in Saskatchewan, Canada, earlier this year, and our Jansen workforce showed a deep value in keeping each other safe. Jansen is a project of enormous scale and ambition, and it's a great example of how we're positioning our global portfolio for success. Success in a world that is increasingly volatile. Over the past year, the world has experienced ongoing humanitarian crises in the Middle East, Ukraine, and Sudan, threats to the continued expansion of global trade by a new wave of protectionism, a range of consequential elections across the globe that are reshaping the policy landscape. In our operations, we're seeing the lagging effects of inflation, an uneven recovery in China, and supply-side surpluses for some commodities, which is contributing to price volatility.
We faced these challenges earlier in the year when we made the tough but necessary decision to place our Nickel West operations and West Musgrave project into temporary suspension. In our view, the best way to create enduring value for shareholders amid all this turbulence is to hold a mix of high-quality, resilient assets and to run them exceptionally well. I am optimistic about our ability to manage through these challenges as the long-term fundamentals for the broader resources sector remain strong. Mining has an undeniable role to play in providing the metals and minerals the world needs to continue to develop and decarbonize. The global trends shaping our future are interconnected, unstoppable, and bring with them new challenges and opportunities for our sector. That's why we have been deliberately and methodically reshaping our portfolio to increase our exposure to future-facing commodities and higher-quality steelmaking materials.
We've achieved a world-leading position in copper, which is key to renewable energy, electric vehicles, and increasingly data centers. We're developing a position in potash that will contribute to food security and more sustainable land use to help feed a global population that is expected to near 10 billion by 2050. We've focused our steelmaking coal portfolio on higher-quality coals. These are preferred by our customers who use our steelmaking coal and iron ore to produce steel, which is needed to build cities and infrastructure for decarbonization. And of course, our iron ore business is a critical part of our future, and we have extended our lead as the lowest-cost major iron ore producer globally, and we continue to see opportunities for greater efficiencies to unlock even more value.
So today we have a portfolio and options for growth that leave us well-positioned to provide the commodities the world will need more of in the decades to come. This augers well for our future, but we have not lost sight of value for today as we continue to deliver strong earnings and returns. In the 2024 financial year, our underlying EBITDA was $29 billion. We continue to produce strong margins and a consistently high baseline of cash flow. In fact, this is the eighth consecutive year where we've achieved a margin greater than 50% and generated average net operating cash flows of over $20 billion per year. This demonstrates the consistency of our earnings despite the cyclical volatility in the resources sector.
Now, I'm a firm believer in capital allocation discipline as the backbone of a successful business, and many of you will have heard Mike Henry and myself talk about BHP's capital allocation framework. This framework prioritizes safety and maintenance capital, balance sheet strength, and a minimum 50% payout ratio for dividends, and accordingly, the board has determined dividends totaling $7.4 billion to shareholders for the year. Over the past five years, our total shareholder return was approximately 15% per annum and included delivering more than $50 billion in cash dividends to our shareholders. Now, this is more than any other miner in the world, and it's a testament to the durability of our portfolio and the consistency of our operational excellence. Now, importantly, we are also creating significant financial value in the communities in which we work and live.
In the 2024 financial year, our total global economic contribution was over $49.2 billion. This included $25.3 billion with suppliers, $11.2 billion in payments to governments through income taxes, royalties, and other payments, and $4.8 billion of wages, incentives, and benefits to our employees. The value we create with our partners and stakeholders is critical to our success. It's what we call social value, and social value means creating long-term mutual benefit for our people, partners, and local communities. We've formalized the way we deliver it through the BHP Social Value Framework, which we launched in June 2022. The framework is focused on six pillars: decarbonization, the environment, Indigenous partnerships, our workforce, communities, and responsible supply chains.
It supports progress towards real outcomes: improved access to employment and economic opportunities in host communities, improved talent pipelines for the industry, increased action on environmental issues, and partnerships for mutual benefit, and this is a reinforcing loop. By setting goals and holding ourselves to account, we push ourselves to get better every year, and this is designed to progressively create more social value, build more trust, and further strengthen relationships, and as a result, we can open doors to new opportunities and partnerships, increase our access to the best resources, business partners, markets, and importantly, talent. Now, one relevant and tangible example of social value in action is our relationship with the Barada Barna people here in Queensland. Our relationship with traditional owners and other Indigenous partners are some of the most important relationships we have.
The BMA joint venture operates on the traditional lands of the Barada Barna, and we've recently reached a new Indigenous Land Use Agreement. For the Barada Barna, this agreement will deliver long-term benefits for the community through investment in employment, education, business, and contracting, and for BMA, it provides vital business certainty and will deepen our relationship with the Barada Barna people. Climate is another area we can make a difference while also growing long-term shareholder value. As you know at our full year results, we shared our latest climate transition action plan, and it reaffirms our commitment to play our part in the global effort to address climate change, and it details our efforts towards becoming a more sustainable and resilient business.
BHP has been setting and achieving targets for operational greenhouse gas emissions since the 1990s, and we're on track to meet our operational greenhouse gas emissions target of at least a 30% reduction by 2030 against our 2020 baseline. We're developing pathways for our long-term goal to achieve net zero operational greenhouse gas emissions by 2050. Importantly, we continue to collaborate with customers and suppliers to support their efforts to lower greenhouse gas emissions in our value chain. Now, since we released our plan in August, we have engaged with many shareholders and stakeholders, and we thank you for that engagement and hope to secure your support for the plan when we get to the Shareholder Climate Vote. Last Friday, we announced a final settlement agreement in Brazil to resolve the key claims by the Brazilian public authorities relating to Samarco's Fundão dam failure.
The dam failure was and remains a tragedy and will never be forgotten, and we are deeply sorry for the loss of life and damage it caused, and we know that nothing can undo the impacts it caused. BHP has always been committed to supporting Samarco and the Renova Foundation to do what's right for the people, communities, and environment affected, and this comprehensive settlement agreement with Brazilian public authorities is another step that reflects that strong commitment. Now, the settlement agreement is in line with BHP's existing Samarco dam failure provision of $6.5 billion, and no update is required to the existing provision at this time. Before I conclude, I'd like to note some important changes to our board since last year's AGM.
As I mentioned earlier, Ian Cockerill and Terry Bowen retired from the board during the year, and we acknowledge their significant contribution to BHP during their time with us. We also had Ross McEwan and Don Lindsay join the board this year, and shareholders will have the opportunity to hear from both of them at today's meeting. Ross and Don are deeply experienced business leaders, and we welcome their skills and perspectives on our board. Now, as I mentioned at the start of my address, we are living in a world which is increasingly volatile. However, we have great optimism in what lies ahead. As the world's population grows, seeks a higher standard of living, and advances the energy transition, demand for the commodities we produce is set to endure and grow.
With our world-class portfolio, we are well placed to provide more of the commodities the world needs in the decades ahead. As we do, we will continue to drive a culture of safe and reliable operations. We will maintain rigorous capital discipline, and we will continue to build social value, which is vital for sustainable long-term shareholder returns. So thank you for your continued support and for investing in the future of BHP. It's now my pleasure to invite your CEO, Mike Henry, to speak with you.
Well, thank you, Ken, and thank you to everyone here with us in Queensland today and watching online. I'm looking forward to taking you through some of this year's highlights and talking about what I believe makes BHP a successful company worthy of your ongoing support. But first, I would like to echo Ken's acknowledgment of the loss of a colleague at Saraji earlier this year. Nothing is more important than the safety of our people. We've concluded our investigation and identified improvements at Saraji and for BMA, and we're working to implement them at BMA across the company and indeed to share them with the industry. We remain resolute in our commitment to eliminating fatalities and serious injuries at BHP. And that commitment to doing what is right is one of our values, and it extends to everything we do.
Last week, I was in Brazil to finalize the Samarco settlement agreement that Ken referenced earlier. I also visited the community of Novo Bento Rodrigues for the second time and saw firsthand the progress made in resettling those displaced by the dam failure. We can never undo the hurt and sorrow caused by the tragic events of 2015. However, this agreement is another significant step forward. Approximately 500,000 people will be eligible for individual compensation under the new system, which will be faster, easier, and more certain. The agreement will support ongoing programs benefiting the environment and health, and it will support socioeconomic revitalization. It is wholly reflective of the values that we seek to uphold. 2024 was another year of strong delivery at BHP, of disciplined execution of our clear, simple strategy, and continued progress on shaping our portfolio for the future.
In doing so, we have pursued our purpose of bringing people and resources together to build a better world. And I want to focus on our purpose for a moment and build on what Ken said about the opportunities for the world that are underpinned by our people, partners, and assets. And specifically, I want to outline what we mean when we talk about building a better world. Let's look at the global shifts BHP's key commodities support: rising living standards and food security for a growing population, better and more livable cities for an increasingly urbanized world, the world's Net Zero ambition, and the rewiring of our energy networks. Our iron ore, copper, steelmaking coal, and potash support the pursuit of a very basic human instinct: to improve the lives of those of generations that come after us.
Billions of people seeking higher standards of living is an enduring source of demand and one that we are all proud to play a role in delivering. Infrastructure and electrification that make our cities better, safer, and more livable. Data centers to power the artificial intelligence boom, which will underpin new technologies and enable greater and greater innovation. Increasing productivity from decreasing arable land, meaning more and better food for more people around the globe. What we produce matters, and how we seek to do it matters too. I hope our shareholders are proud to be here with us as we move forward with our strategy, and I hope you see that our progress has purpose. Governments around the world are focused on how they deliver progress for the nations too. We think markets work best when global trade and economic cooperation are prioritized.
A focus on economic fundamentals, competitiveness, productivity, investment certainty allows capital to find its best use and stimulate growth. Removing barriers to trade, not building them, allowing capital to flow where it's most needed. Regional and national economies working effectively as more than the sum of their parts. BHP will continue to engage constructively with governments around the world to advocate for policy settings that drive the competitiveness of their economies, benefit their citizens, create jobs, and encourage businesses to grow. Of course, value-adding growth is firmly on our agenda at BHP too, and it is underpinned by our track record of strong business performance in recent years. In financial year 2024, we achieved production records at a number of our assets, and we widened our lead as the world's lowest-cost iron ore producer.
This is a credit to the more than 90,000 employees and contractors who work so hard to build a better BHP every day. I can't speak strongly enough about the importance of operational excellence to our success. We invest heavily in the capability of our people. Our BHP Operating System, the way our people work from the mine site to the office, is a genuine competitive advantage and a source of great pride across many parts of our business. The solid operational performance of our workforce that our workforce delivered, along with higher prices in key commodities, helped us to deliver dividends totaling $1.46 or about AUD 2.20 per share for the year. Since financial year 2021, BHP has paid the most dividends of any mining company globally and, in fact, has been one of the highest dividend payers across all industries.
Our performance also allows us to plan for and invest in value-adding growth projects. Now, as we've done that, we've continued to reshape our portfolio to position BHP for the future. This deliberate strategy gives the company and our shareholders greater exposure to commodities that will stand to benefit as global mega trends play out around us. We've strengthened our already very strong position in copper, and we're exploring further growth around the world, like in South Australia, where we could grow copper production to around 500,000 tons a year, with further potential upside of up to 650,000.
At Escondida, already the world's largest copper mine, where we have potential to add around 200,000 tons per year, and at the Filo del Sol and Josem aria projects in Argentina and Chile, where we will seek to advance through a 50/50 joint venture with Lundin Mining after our joint acquisition of Filo Corp. We expect completion of that transaction in the March 2025 quarter, subject to regulatory approvals, and we will have the opportunity to advance what we consider to be one of the most significant copper discoveries in decades. Now, in nickel, conditions have been more challenging, and we took the difficult but necessary decision to temporarily suspend our Western Australian nickel business. We are continuing to invest to enable a potential restart of Western Australian nickel if the market outlook improves, and we'll review the decision by February 2027.
Across in Canada, construction of stage one of our Jansen potash project is more than halfway complete and ahead of original schedule, and we've begun to execute on stage two. First production from Jansen is only around two years away, and by the end of the decade, we expect to be one of the leading players in the potash industry globally, and this will feed into a global market which is expected to grow strongly for decades. Jansen is set to become a world-class asset in an investment-friendly jurisdiction and to create value for generations to come. These decisions are consistent with our strategy, which is clear and simple. We have a differentiated portfolio of the best assets in the most attractive commodities, and we operate them excellently and apply discipline to our allocation of capital. The precise execution of this strategy underpins our results and our shareholder returns.
Resources is a cyclical industry, and the stability of our strategy and the reliability of our execution make for a durable and resilient business. We heard earlier from Ken about growing volatility in the world, and I speak regularly with investors, customers, and partners around the globe, so I know that we're not alone in believing this will continue for the foreseeable future. In this global context, there is stability and resilience in our size, the quality of our assets, and the strength of our partnerships. A strong balance sheet and diversified commodity base helps to shield us against the cyclical nature of our sector and geopolitical uncertainty. It also leaves us well placed to work with smaller miners and explorers to bring new deposits to market faster and with less risk in execution.
In doing all of this, we can continue to deliver strong margins and cash flow, and BHP's record stacks up well. Over the past decade, BHP's margin has averaged around 55%. That's over 10 percentage points higher than the average of the next closest competitor. The creation of social value is integral as well to our strategy and to delivery of long-term shareholder value. I spoke earlier about the irrefutable need for mining as we work towards our future, and if the starting point is that we need more of these resources, then the bigger questions are who should bring them to market and how. In our view, it will be large, diversified miners like BHP with the balance sheet strength, track record of operational excellence, and social value credentials who will increasingly play that role.
When we create social value, we build our case as the preferred partner for communities and governments. We gain access to more opportunities, and we attract the best talent. The impact of our social value approach on our current and future workforce is invaluable. It's making our workforce more inclusive and diverse, which drives better outcomes in safety and productivity, and it's building a pipeline of future talent in highly skilled roles that will help support productivity and keep economies, including Australia's, strong. This includes BHP's Future Fit Academy, established as part of our Operations Services mining services organization at a cost of $300 million in Mackay here in Queensland and in Western Australia. The Academy has already graduated more than 750 new-to-industry Australians, providing them with skills for the future and a high-paying job with BHP from day one.
Our social value approach also drives tangible results for the communities and suppliers vital to our business and to livelihoods in the regions where we operate. This year, we spent more than $3.3 billion with more than 2,600 small, local, and Indigenous businesses, up 9% on last year. Here in Australia, our Local Buying Program, which was established first here in Queensland, has more than 1,500 registered suppliers, and we've approved over 90,000 work packages worth over AUD 1 billion since its launch in 2012. Finally, we also made further progress on our operational decarbonization plans, and as Ken noted, we remain on track to meet our operational greenhouse gas emissions target of at least a 30% reduction by financial year 2030 against a financial year 2020 baseline. This is valuable work that benefits our shareholders, our partners, and every economy in which we operate.
It's an example of how at BHP we think and plan in decades. We're focused on creating value now and into the medium and long term, and that mindset continues to serve our shareholders, employees, and partners well. Again, ladies and gentlemen, what this company does matters. Our work and your support of it through your investment in BHP is vital to building the future we all want for generations to come, all while maintaining our focus on operational performance, disciplined capital allocation, and value creation for shareholders and communities. This is a great company performing well and made up of people who want to make a difference. I'm excited about the years ahead and confident that BHP will continue to deliver value to you, our shareholders. Thank you for your ongoing support.
Yeah, I don't need this actual harassment. I don't need the copper one. Thanks, Mike. I'd now like to ask our Group Company Secretary, Stefanie Wilkinson, to outline the procedures for voting at today's AGM.
Thank you, Ken, and hello everyone. I will now run through the procedural aspects of today's meeting. Voting on all items today will occur by a poll. On a poll, each shareholder attending or present by proxy, attorney, or representative has one vote for every share held. If you are eligible to vote, you can use your own device to vote by scanning the QR code on your voting card. As a next step, you will need to accept the terms and conditions which pop up on your screen in order to continue. The resolutions will then be displayed on your screen. To cast your vote, simply select for, against, or abstain underneath each resolution. A tick will appear to confirm receipt of your vote.
To change your vote, select click here to change your vote and select a different option. You can change your vote at any stage until the poll closes. If you experience any difficulties, the registration desk in the foyer will be able to provide assistance. Alternatively, please complete the voting instruction on the back of your voting card and place it into one of the available voting boxes. The chair has opened the poll, and you can vote at any time. You do not need to wait for the resolution to be discussed before casting your vote. Results of the voting will be announced to the stock exchanges shortly after the conclusion of today's meeting and will also be published on our website. Tim Hughan from Computershare has been appointed returning officer for the meeting and will scrutinize the vote.
Turning to the items of business in the notice of meeting, all items one to 13 in the notice are endorsed by your board, and the board recommends that you vote in favor of them. We will ensure that there is a reasonable opportunity for shareholders as a whole to ask questions or make comments at this meeting. However, we may not be able to answer every question or address every comment received. If you would like to ask a question today, please register your question at the registration point outside of the main room. Please provide your name together with the nature of your question to the attendant. When it is your turn to ask a question, an attendant will let you know to come to the microphone.
To ensure that shareholders as a whole have a reasonable opportunity to be heard at today's meeting, we ask that you respect the rights of others in the room and limit the number of your questions to two questions and your comments to no more than one or two minutes. The registration point will remain open throughout the meeting if you wish to register to ask a question. Back to you, Ken.
Great. Thanks, Stefanie. Item one of today's business is to consider the financial statements and reports from the directors and external auditor for the year ended 30 June 2024. Shareholders are not required to vote on this item, but you may ask questions or make comments. If your question relates to director elections or reelections, executive remuneration, or the 2024 Climate Transition Action Plan, you'll have the opportunity to ask your question when we come to those items.
So I'll now take questions and comments on item one from the floor, and we will do our best to get as many of your questions and comments as possible. But as Stefanie mentioned earlier, to ensure that shareholders as a whole have a reasonable opportunity to be heard at today's meeting, please limit the number of questions to two and comments to no more than one or two minutes. And I ask that shareholders and guest s are courteous and respectful to others. So we'll now move to microphone two and take our first question. Thank you.
Chair, I'd like to introduce Ms. Alison Harrington.
Welcome, Ms. Harrington.
Thank you. Thank you very much. I'm representing the Australian Shareholders' Association, which is never frightened of asking the tough questions of boards. But we're very pleased to say that BHP, we've agreed with all of the resolutions today. And to also tell you that we're representing 5 million, nearly 5 and a half million shares. So that's a great trust in ASA from shareholders. My question is, could the Chairman explain the relative poor profitability of the copper division and what is being done to improve it?
Great. Thanks for that question. You're probably referring to the return on invested capital in copper because the copper business is actually quite profitable, but the majority of that relates to the Olympic Dam acquisition and the goodwill that was paid for that asset some time ago. But I have to say we are very excited about copper as a commodity going forward. And the reason is we believe it's attractive. Copper demand is expected to grow by 70% between now and 2050, driven by the fundamentals that Mike was talking about in his speech around decarbonization, electrification, digital.
And so all of these things are going to continue to drive demand for copper. And then on the demand, on the supply side, when we look at the expected new projects coming to market, there just aren't enough. And the investment in new copper production just isn't going to be enough to keep up with demand. So we see it as the supply-demand fundamentals as being very attractive. And again, as Mike mentioned, we've got a pipeline of attractive projects with attractive returns in our portfolio. So we think copper, there are some historic reasons why the return on invested capital is low, but the prospects going forward look very strong. Thank you. Question two.
Chair, I'd like to reintroduce Ms. Alison Harrington.
I was surprised, Ms. Harrington, you didn't take advantage of the two questions.
Oh, no, no, I was. I wasn't. I was sort of told that I might be slotted in later on. You've touched on workplace safety. Could the chairman update us on the work they're doing to reduce poor workplace behavior, including bullying and sexual harassment and FIFO issues, particularly in remote locations?
Yeah, look, great question. Both Mike and I referred to this as a really important issue at both board level and management level. First of all, sexual harassment, it's unacceptable. It's unlawful. It's contrary to our values, and it has no place in our business, in the sector, in the community. And we've been treating sexual harassment as a health and safety issue at BHP since 2018. And what that means is it falls into our processes around all safety issues and gets due diligence around that.
And we've focused on implementing controls to prevent sexual harassment, critical controls around recruitment, training, safety, security, care and support for people impacted, investigations, disciplinary action. We've invested in upgrading, to your point, around FIFO employees. We've invested in security controls at all of the accommodation villages. We have a person-centric trauma-informed response around all of that. We provide training and education. As a matter of fact, the board has been through some of that training. Last year, we went through Spectrum of Conduct training ourselves, which is we have this respectful behavior training program that all of our employees and contractors need to go through. And we're very clear around our expectations with our coworkers around behavior. And we're also investing in active bystander training. So sexual harassment, it's a board-level priority. It's supported by the Risk and Audit Committee and the Sustainability Committee.
The Risk and Audit Committee, we have a whistleblower program that monitors the reports of sexual harassment at a very granular level and monitors the actions, the follow-ups, and any disciplinary action that comes out of that. And then through our Sustainability Committee, as we do with all health and safety matters, we're monitoring the effectiveness of the critical controls that I talked about. Thanks for the question. Next question, Question Point One.
Chair, I'd like to introduce Mr. Graham Thompson.
Welcome, Mr. Thompson.
Thank you, Chair. I begin by saying that BHP is doing very many things very correctly and right.
Thank you.
My question, however, is a little critical in one important area. My question concerns the dividend, not the quantum of the dividend, important as that is, but the date of the payment of the final dividend and of the interim dividend.
Are you aware, Chair, that your board has presided over the worst performance in the last 20 years? Are you aware of that? The final dividend this year was paid on the 3rd of October. Of course, shareholders get the dividend the next day in their bank accounts. That's two weeks beyond best practice. Mike Henry talked about excellence in the company. So excellence in respect of the final dividend is two weeks out of whack. So my question is, in this time of continuing inflation and cost of living pressures that affect us all, can you seriously address the question of getting the payment of the dividends back to best practice? I raised this issue at an AGM of BHP back in Perth, I say, more than a decade ago when Jac ques Nasser and the Scotsman were in charge of the company, and it came as a surprise too.
I don't know who's looking backwards in the company occasionally. I know the management dogma is always to look forwards and at the present, but please occasionally look backwards. And lastly, could you also consider exceeding best practice, exceeding it? I'm sure all of the people in BHP who work on the production side of the business understand that idea of exceeding best practice. But how about you, the board, ensuring that it happens in respect of returning what is ultimately directed at the shareholders? T hank you.
Thank you, Mr. Thompson. First of all, thank you for the kind words to begin with. And thank you for the fact that you are happy with the quantum of the dividends. We hope so. It's been $50 billion over the last five years. So it's a significant amount of money. But I accept the challenge. I accept the challenge. We are about getting good, never rests. And so I accept the challenge. I'm not aware of how we benchmark against, to be honest. I'm not aware how we benchmark against others on the expediency of the payment of our dividend once it is. And I'm not challenging you on that. We'll do the work and we accept the challenge. And if there's opportunities to do better, w e will.
May I say also very briefly that prior to 2004, the final dividend used to be paid in the first two days of July. Now, I assume the reason why we suddenly transferred from 2004 onwards was to do with the joint listing and the different financial years between the U.K. and Australia, which might have meant that U.K. shareholders would have had three dividends in one financial year. It's not an important issue, but in terms of history, which of course I'm a little bit interested in, once the dividend was paid at the beginning of July, the final dividend.
Yeah. Look, to answer your question, we declare the dividend at the August board meeting when we finalize the account. So that's when it's declared. So that's sort of the middle towards the end of August. And so obviously it's taking six weeks for the dividend to get out to shareholders. And again, I accept the challenge. Question Point Two.
Chair, I'd like to introduce Mr. Frank Karg.
Mr. Karg.
Good morning.
Mr. Karg, welcome.
Thank you. In regards, as you can tell, I'm a Yankee. Anglo American, kind of a two-part question. Where are we now? And is there any other companies that are similar that we can pursue?
Well, thanks for the question. Look, I'll talk to the rationale on where we are now, and Mike can talk about the pipeline. So where are we now? I mean, just for the benefit of all shareholders, we made an approach to Anglo American earlier this year. And that was a deliberate approach. It's not as though we are being opportunistic. We plan these things and keep an eye on market activity. And it looked like where their share price was trading sort of came within the window of opportunity that made sense for how we were valuing the company. And so we moved. And we thought there was an opportunity here to create something unique and special, a bit of a sort of a one plus one equals three opportunity by putting these companies together. There were a lot of synergies and opportunities.
And we had a clear view in our mind around the value that we could create and the value that we were prepared to pay. Unfortunately, Anglo American shareholders had a different view, and they thought there was more value in the plan that their management wanted to execute. And so they moved on. And quite frankly, so have we. It was never a transaction that we had to do. It was a nice to have, not a must-do. And so we've moved on as well. And for example, we've just concluded, or we're subject to regulatory approval. We've done a transaction with Lundin Mining around a very interesting copper project in Argentina, for example. But Mike, do you want to talk about.
I'll pick up from your comments, Chair, on this not being a transaction that we had to do. It was a nice to have.
It's really, really, really important that we all understand that transactions are but one avenue for growth for the company. And they're actually not the fundamental avenue. Before that, we have growing value through productivity, still the biggest single value lever or value growth lever for the company. We have greenfields exploration. We've increased our activity in greenfields exploration for copper resources globally. We have getting more out of the resources that we already have. And BHP has the largest endowment of copper resources of any company in the world. And we see the fruits of that coming through now with the growth opportunities that we have at Escondida, potentially a project with another company, Rio Tinto in the U.S., through a smaller acquisition, the opportunity that we now have in Argentina, and of course, the opportunities right here in Australia.
So we have lots of attractive growth ahead of us before we start contemplating acquisitions. Now, where we do consider acquisitions, we are very disciplined about it. It has to be for the right assets, large, long life, low cost. And there has to be an opportunity for BHP to unlock further value through our ownership, through synergies, oftentimes operational, sometimes other synergies. So at all times, very disciplined.
Okay. Thank you, Ken. Thank you, Mike.
Thank you, Mr. Karg. Question Point One.
Chair, I'd like to introduce Mr. Ray Shaw.
Welcome, Mr. Shaw.
Thank you. Morning, Chair. Welcome to Queensland.
Good to be here.
Mr. Chair, I'd like to, well, I was wondering if the forthcoming U.S. elections, and depending who gets the prize, whether it's Trump or Harris, do you consider that that might have an effect on China? And if so, do you consider that China might increase our volume of iron ore? They've been a bit slack lately and gone backwards in taking our iron ore. And I was just wondering what the general picture is.
Yeah. Great question. Great question. Do you have another one, or is it just that one? Yeah. Look, it's a great question. And iron ore, as you know, is a really important part of our business. And as I mentioned in my speech, we are the lowest cost major iron ore producer in the world. And it's really been under Mike Henry's stewardship that we've achieved that position. We weren't always the lowest cost producer, but we are today. And the good news for shareholders is every year we keep creating more daylight between us and number two. So we're pretty excited about that.
The vast majority of that iron ore is going to China, as you said, and what's interesting is there's, I think this is the fifth consecutive year that China's done more than a billion tons of steel, and it's interesting what's happened in the Chinese market in terms of where that steel's going. Less and less of it's being exported. It's actually a tiny fraction now of that steel gets exported as raw steel. It's all for internal consumption, and less and less of that steel is going into housing. So a lot of the concerns of late have been around the domestic Chinese housing market, and probably five or six years ago, that might have been 40% of steel consumption. It's about 20% of steel consumption, and what's taken its place is a lot of green technology, electric vehicles, solar panels, wind turbines has sort of taken the place.
China is dominant in that market. So we're pretty optimistic. There's a mutual dependency between China and Australia. We need them, and they need us. They don't have iron ore of the scale and quality that we have. And so they need our iron ore, but we also need their demand for the product. So we are still optimistic going forward. And I have to say, through all of the geopolitical turbulence of the last decade, our relationships with our Chinese customers just continue to go from strength to strength. So from a business-to-business relationship perspective, we're in a really strong position with our Chinese customers. But thanks for the question.
Okay. Thank you. Question two. Chair, I'd like to introduce Ms. Linda Brooke.
Welcome, Ms. Brooke.
Thank you very much, Ken and Mike. Good morning. I have one question. It only needs a binary answer. So my question is, would the board consider investment in health in Barada Barn a, and I hope I've pronounced that correctly, to increase goodwill and building strong social value? So this is sort of on a granular level. Would the board consider that?
Well, actually, those sort of social value investments are board-level decisions. So we work on the framework, and management executes the decisions around where those investments are actually made. And I'm looking, I think this is an Australian opportunity. Geraldine, I might get you to stand up. Ms. Brooke, this is the person you should talk to at sandwiches and tea about this opportunity. And we'll get a hearing.
Right. So we do funding?
Well, no, it's not a decision that we're going to make at this AGM. This is the person you need to talk to. In a large corporation like this, authority is delegated down to the organization, and this is with management. And so the right person to talk to isn't me at this meeting. The right person to talk to is Geraldine.
Geraldine. Okay. Thank you.
Thank you. Question Point One.
Chair, I'd like to introduce Mr. David Copeman. Mr. Copeman, welcome.
G'day. I'm Dave Copeman. I'm the director of the Queensland Conservation Council and a proxy holder today. My question is in relation to financial statement note number three, exceptional items, and financial statement note 17, impairment of non-current assets in relation to provision for liabilities for the 2015 Mariana Dam disaster. Now, this is where 43 million cubic meters of toxic waste, including arsenic, was expelled into the Rio Doce, including the killing of 19 people and the injuring of thousands.
Now, Mr. Chair, I understand at last year's AGM, you told shareholders that BHP and Vale had compensated and remediated for the damage of the Tailings Dam collapse. Now, despite assurances from BHP leadership that there was no further liability, it's my understanding that BHP and Vale made the announcement of the $46 billion settlement, which you referred to in your opening statement today of the Brazilian and federal state governments. And this remediation will only see payments over the next 20 years, concluding almost 30 years after the 2015 dam disaster. And my understanding is that settlement still leaves hundreds of thousands of people, of victims of this disaster, uncompensated, and that they're bringing a litigation. They're suing BHP and Vale in the U.K. High Court for $71 billion in compensation. Shareholders need to understand the true extent of the liability for BHP and Vale's environmental crimes in Brazil.
I think that this should be represented accurately in the financial statements. So I guess our question is, when will the affected Brazilian people be compensated fully, and what future risk is there to shareholders, and when will the damage to the environment done by BHP failures in this dam disaster be fully remediated? And again, what are the likely future obligations to shareholders in terms of impacts on the financial statements?
Great. Thank you for that question, Mr. Copeman. There are a couple of inaccuracies in your comment. We are still remediating. So we've never said that it's been done. There's still lots of work to be done. And we've also said that the provision, and actually, I should probably just step through the provision, but the provision has not been finalized in nature.
So let me just take a step back because I think this is an important question. I'm going to cover the provision question, and then I'm going to give an update on where we are with Samarco in some detail. And I do that every year for shareholders. But look, let's deal very importantly with the provision, which is the first question that you asked. The current provision in our accounts is $6.5 billion. And as we've mentioned, we've done a new settlement. There is no requirement for us to change the existing provision. That provision actually grew quite a bit this year. We added to it, I think, $3.8 billion was added to the provision through the year that got us to $6.5 billion. And then when the settlement was finalized, a review of that didn't require us to change it.
Now, this provision, as all provisions do, reflects our best estimate of outflows required to resolve all aspects of the Federal Prosecution Office claim in Brazil and the Framework Agreement. This includes three key components that make up the claim, which are remediation, compensation, and moral damages. Now, the provision also includes the remaining costs to complete the programs under the Framework Agreement. That's environmental remediation, resettlement, and compensation. Now, as with any provision, it requires the use of judgment, estimates, and assumptions. Now, one of these assumptions is how much Samarco, as the primary responsible party, is going to be able to fund.
What Vale and BHP have said is, "What Samarco can't fund, then we will step in and fund on their behalf." So this provision also doesn't include every cost or liability that may be payable by BHP as a result of the dam failure. So, for example, and you mentioned we have proceedings on foot in the U.K. and Australia, and it's not possible to reliably estimate any potential exposures for these claims. And so in that case, because we can't make a reliable estimate, they're recognized as contingent liabilities in our accounts. So the provision is for what we can reliably estimate, but it's still an estimation, and we make assumptions around that. And then for those things that we can't reliably estimate, we create what's called a contingent liability in our accounts. So that's the status of the provision.
Now, I'm going to take this opportunity, as I do every year, just to give you an update on exactly where we stand with the Samarco dam failure. And let me start by saying what I said and what Mike said during our respective speeches, is that the Samarco dam failure was and remains a tragedy, and it'll never be forgotten. And we are deeply sorry for the loss of life and damage that it caused. And we know that nothing can undo the impacts it caused. But last week, as I mentioned in my speech, was an important step. On Friday, we announced that the Brazilian public authorities have signed an important agreement with BHP Brazil, Samarco, and Vale for a full and final settlement of the Public Prosecution Office claim and all other claims by Brazilian public authorities relating to the dam failure.
Now, the negotiation process included several public forums and community meetings to ensure the voices of the impacted communities were directly heard. The total financial value of the agreement is $32 billion, which will provide compensation and benefits directly to the people, communities, and environment in the regions affected by the dam failure. Now, the agreement provides funding for projects and payments across a range of areas, including water sanitation, the public health system, economic recovery, local infrastructure, and income support for the most vulnerable people in the affected regions. Now, these are designed to compensate and remediate the impacts of the dam failure and will leave a lasting legacy in the regions. The payments will be largely front-end loaded, and compensations to individuals will be prioritized. The majority of the new compensation payments are expected to be paid in calendar year 2025.
Now, the settlement also provides specific compensation for Indigenous and traditional communities whose way of life has been affected by the dam failure, and it establishes a consultation process led by the Brazilian federal government, which will allow each community to decide how they will address the collective impacts to their communities, including through payments to individuals or community initiatives. This agreement establishes a further indemnification system that will capture remaining claims from individuals who have not previously been able to access compensation through existing compensation systems in Brazil, and this new compensation system was designed in consultation with the public authorities to be a simplified system to capture the remaining claims for those who are unable to meet thresholds of existing indemnification systems.
In short, claimants will only be required to provide a proof of identity and residency in one of the affected areas in order to claim under the new system. Now, from the outset, BHP has always been committed to supporting Samarco to do what's right by the people, the communities, and the environment affected. And this comprehensive settlement agreement with the Brazilian public authorities is another step forward in achieving finality to the ongoing litigation. The agreement reflects our ongoing commitment and builds on the existing remediation and compensation programs already being performed by the Renova Foundation in Brazil. And during the year, significant progress has been made on the ground in Brazil by Renova across the key areas of environmental remediation, community resettlement, and compensation for those who have suffered loss. So let me step through each of those in turn. Environmental remediation, further progress has been made.
The impacted riverbanks and floodplains of the Rio Doce have been revegetated, and water quality has returned to historic levels. Now, Renova, the foundation, has invested more than $170 million in water treatment and sewage treatment facilities that improve water quality in the Rio Doce. That goes beyond just addressing the impacts of the dam failure. And what I think is important here is in the new agreement, the one that we've just signed last week, there's a further $1.9 billion available for further investment in water treatment facilities in the Rio Doce Basin. So there's going to be 1.5 million people who will benefit from the sanitation work along the 700 km of the Rio Doce, as I mentioned, for sewage collection and water treatment. Now, why is this important? Today, in the Rio Doce, 270 million cubic meters of raw sewage goes into the river, untreated.
270 million cubic meters today. That's six times the amount of tailings that were released, just to give it some perspective, that were released into the river. So this is a serious issue. And again, this agreement with the Brazilian authorities that we've just signed will provide $1.9 billion in order to provide water treatment facilities throughout. In the second area, resettlement, Gary Goldberg and I visited the communities last year. We walked around Novo Bento. We walked around Paracatu, Mariana. We spent time with the impacted community members. We visited homes. We heard their stories. We went to the schools. And there's good progress being made in the resettlement. 91% of the cases have been resolved, and we still have some way to go. Now, this has taken way too long. The resettlement process has taken way too long. We accept that. There's a number of reasons for that.
A lot of consultation with the communities about where the new communities would be built, the procurement of the land for that, the town planning that was required. Each home was done. They were allowed to choose an architect. It's a bespoke home. They didn't pick it off the plan. It had to be built. We lost a lot of time through COVID. So these are not excuses. It's just facts. That's why it's taken as long as it had, but we're hopeful that by the middle of next year, the final 9% of cases will be resolved, and then finally, in the case of compensation, to date, $3.5 billion has been paid in compensation of financial assistance to 430,000 impacted individuals, and as I mentioned, there's a new compensation program in place that those who have been unable to access the existing ones can then sign up to.
Then your final question, outside of Brazil, we are facing an action in the U.K. brought by a specialist class action firm. We're going to continue to defend the U.K. action and deny those claims. The U.K. action overlaps with Renova's compensation processes in Brazil. And for further clarity, the provision does not include the U.K. and Australian Samarco proceedings. And these are recognized in our accounts, as I mentioned earlier, as contingent liabilities. Now, I've tried to be fulsome in this update, but I'm also conscious that the U.K. action is currently underway in the U.K. courts, and it wouldn't be appropriate for me to comment further. And just maybe on what, Mike, we were just there last week, and you visited the communities as well.
So that's right, Chair. I visited one of the rebuilt communities.
I was there two years ago as well, and it was a little bit like a movie set then. All of the houses or many of the houses built, but nobody moved in. Whereas this time, the people were living in the homes. There were cars on the street, pets running around. We went to one of the schools and saw children playing indoor soccer, and hearing their laughter was quite something. Visited a few of the shops and restaurants. One gentleman took us into his home to meet his family. And so it really is now feeling like a community. As Ken mentioned, not all houses are yet occupied. There's still a process underway, but we're getting very close. And by the middle of 2025, we expect that process to have been completed and for the remaining people to have moved into their homes.
Do you have a second question, Mr. Copeman?
Thank you, Chair. I'd just like to reintroduce Mr. David Copeman.
Thank you.
No, thank you for the fulsome answer. I understand that the matter of the class action is before the courts, but I was disturbed by the recent report in Reuters about actions that BHP is taking in relation to that claim where there's $1.7 million in funding to the Brazilian Mining Association, IBRAM, which asked the Brazilian Supreme Court to sever 46 Brazilian municipalities and prevent a significant number of claimants from participating in the overseas proceedings. Now, there was some lack of maybe clarity when BHP was confronted with the evidence that they were working with IBRAM on this.
And following that publication of the fact that you were funding this, the English courts required BHP and its counsel to sign a consent decree, agreeing not to make further payments to IBRAM relating to the Supreme Court petition. And if violated, it's my understanding that BHP executives and board members could face criminal and civil liability. Given the U.K. court has instructed BHP to not play any role or cause any third party to continue the Supreme Court claim in Brazil, is it correct that BHP shareholders have just seen $1.7 million of shareholder money disappear? And my question is, who authorized these payments to IBRAM? And if BHP, as it appears, is the sole funder and that no other is it correct that no other IBRAM members were involved in this? And therefore, was the board aware of this scheme, and did you approve the payments?
Yeah, Mr. Copeman, look, as I said, I've been as fulsome as I can. These proceedings are afoot in the U.K., and it's just inappropriate for me to make any further comments on the matter.
Sorry, I was asking about the payments, not the proceedings.
Yeah, no, I understand.
Okay. Just finally, for the amounts of settlement, how much of that was insured? How much of that is being borne by insurers versus by the local subsidiary and then Vale and BHP?
Well, that would all be in the our component is in the that we need to pay is accounted for in the provision, and I've been through that in detail. So thank you. Any further questions? Okay. As there are no further questions on item one, we're going to move to the next item. So the next nine items relate to the election and reelection of your non-executive directors. At BHP, we undertake annual director elections for all our directors each year. And this year, Ross McEwan and Don Lindsay are seeking election by shareholders for the first time, having been appointed a non-executive director after the 2023 AGM. Now, the remaining non-executive directors submit themselves for reelection. And I'd like to invite Ross and Don to say a few words now. So Ross, would you like to address the meeting?
T hank you very much, Ken, and good morning, everyone. It is an honor to seek election here today at BHP. I believe our company is well positioned to create significant long-term value for all stakeholders, including you, our shareholders.
Since I joined the board in April, I've had the opportunity to visit a number of our assets across the globe, and I've been impressed by the technical capability of our people and the extraordinary passion they have for their roles. BHP has a strong strategic framework and disciplined approach to capital allocation. This has helped produce a high-quality portfolio of assets and commodities that are essential for global economic development and decarbonization. BHP has also differentiated its approach to social value, and this goes hand in hand with creating long-term sustainable value. For me, this is what sets BHP apart from its peers and makes it a company that I am proud to be part of. Prior to joining the BHP board, I was the CEO of National Australia Bank, and prior to that, the Group Chief Executive of the Royal Bank of Scotland based up in the U.K.
I've also held executive roles at Commonwealth Bank of Australia, First NZ Capital Securities, and National Mutual Life Association of Australasia. After retiring from NAB earlier this year, it has been a pleasure to begin my journey on the board of BHP. I am absolutely committed to further continuous development and am confident that I can manage the time required to fulfill the responsibilities of this important role. If elected, I look forward to working with my colleagues on the board, my fellow members of the Risk and Audit Committee and the People and Remuneration Committee, and BHP's leadership team to continue to create long-term value and returns and to deliver on our purpose. Thank you.
Thanks, Ross. Don, would you like to address the meeting?
Thank you very much, Ken, and good morning, everyone. I want to start by saying that it is an honor and a privilege to stand for election to the BHP Board of Directors, and it's a company that I consider to be the premier company in the global mining industry. You know, I've been hanging around the mining industry for a long time. I visited my first mine in 1968. It was a copper mine in Canada, and the next year, in 1969, I bought my first shares in a mining company, which was a large copper discovery that became the Kidd Creek Mine. In the '70s, I worked underground in the uranium mine in Saskatchewan, where BHP, of course, has the Jansen potash project, and that was to help put me through my mining engineering degree at Queen's University.
When I graduated as a mining engineer, my first job was as a foreman in the pit at Canada's largest iron ore mine. I tell these stories simply to say that I'm very comfortable with the portfolio of commodities within BHP. Thereafter, I joined a large Canadian bank, CIBC, and I formed a global mining finance group. We had offices around the world, and that brought me here to Australia 35 years ago in 1989 for my first visit to Melbourne, Sydney, and Brisbane to meet mining companies, and as you might guess, my very first meeting was with BHP. My last meeting was actually here in Brisbane. I met with MIM Holdings, Mount Isa Mines, and we became advisors to them for the next five years, so I came to Brisbane two or three times a year in those days.
I further deepened my participation in the Australian mining industry when we made an acquisition for the bank of a company headquartered in Perth that had an office in Sydney. What was really exciting to us is it had an office in Kalgoorlie, and we became the lead sponsors of the famous Diggers and Dealers Conference, which I attended for about 10 years. Ultimately, I became president of CIBC World Markets, which is Canada's largest investment bank at the time, and then became president and CEO of Teck Resources, one of Canada's largest mining companies. Teck, of course, was a partner with BHP at Antamina and a competitor in the steelmaking coal businesses. Having retired from Teck after 18 years, I'm now chair of the board of Manul ife Financial Corporation, one of Canada's largest financial institutions.
And along the way, I chaired the International Council on Mining and Metals, working closely with Mike Henry and three of his predecessors. And under my watch, we established and announced the global industry standard on tailings management. I also chaired the governor's forum on mining and metals for the World Economic Forum, and I was chair for three years of the Business Council of Canada. I'm confident that I have the time required. I've stepped back from three organizations, two volunteer, and one business in order to have the time to participate on the board and the Risk and Audit Committee and the Sustainability Committee. And I look forward to contributing to the culture of strong commitment to performance. Like Ross, by tomorrow, I'll have visited five of the operating sites. And of course, in my previous career, I've visited several others, including Escondida and Antamina.
I hope to continue to help to contribute to continuing to deliver value to you, our shareholders, now and into the future. Thank you very much.
Great. Thanks, Don. I hope you agree with us that these are strong additions to the board. Do we have any questions on items 2 to 10? Okay. As there's no questions, we'll show the proxy results for items 2 to 10 on the screen, and we'll move to items 11 and 12. During the 2024 financial year, our People and Remuneration Committee continued its focus on a remuneration approach that supports the group's global strategy and enables us to attract, retain, and motivate our global executive team while incentivizing them to build long-term sustainable and value-adding business. This is critical to the best outcome for all BHP shareholders.
The 2024 financial year was the fifth year of the application of the revised remuneration framework that was approved at our 2019 AGMs. We believe this framework is continuing to serve shareholders well. Item 11 requests an adoption of the remuneration report for the year ended 30 June 2024, and Item 12 seeks approval for equity awards to the CEO. This year, these awards are being made under the Cash and Deferred Plan and Long-Term Incentive Plan described in the framework that, as I mentioned previously, was approved at the 2019 AGMs. Do we have any questions on Items 11 and 12? Question Point Two.
Chair, I would like to introduce Mr. Gregory Ivey.
Mr. Ivey, welcome.
Thank you, Chair. By way of introduction, thanks for the morning tea, which was welcome after an early morning start in regional Queensland.
But I was unhappy to see our money being wasted on too many security staff and the hiring of Queensland Police officers to walk around this venue. In my opinion, that was a flawed risk management analysis. And yes, I know about the protesters outside. My question is about the annual earnings the company pays the CEO. Figures on page 121 and 127 of the annual report would indicate that the CEO earns about $7 million or about AUD 11 million. If you compare that with the figures from the Australian Bureau of Statistics for 2024 on full-time adult average total earnings in Australia, the CEO earns 106 times the average Australian earnings. 106 times is excessively generous. All shareholders should let that sink in for a moment. 106 times. I believe that my calculator is accurate. This is not disciplined capital allocation, one of your boasts this morning.
BHP, because of its leading market position in Australia, should set an example for relatively fair annual payments to its CEO, and given the socially dangerous gaps obvious around the world between the haves and the have-nots, aren't you risking BHP's social and community license by continuing to pay excessively generous earnings to your CEO?
Thank you, Mr. Ivy. First, on your comment around safety, take those on board, but as we've mentioned before, safety and security is the most important priority for us, and it's just an area that we're not going to take any shortcuts on when it comes to people who are within our stewardship, so take your comments on board. Secondly, accept your comments. The CEO is well paid, but there's a process around that to ensure that he's paid in line with his peers in the mining sectors.
And so there's a very rigorous process using external benchmarking around that in order to ensure that we are keeping in pace with the market. And leadership matters. It's important that we attract the best possible leadership, both at CEO, ELT, and further down through the organization to lead this company. And I think the outcomes that we've talked about earlier, and certainly in the last five, seven, 10 years, have been strong within BHP, and that's what leadership is all about. Now, in the case of Mike's specific pay, if we go back in 2013, BHP reduced the pay between the CEOs at the time, which would have been Marius Kloppers and Andrew Mackenzie, by 25%. When Mike Henry was appointed, we further reduced his compensation by taking his pension contribution from what was then standard 25% down to 10%. So another 15% reduction on top of that.
As I said, when we benchmark Mike against his peers, he's paid less despite the fact that he's running the largest mining company in the world. So we need to make sure that we're competitively positioned. It's a complex global business. It requires a strong, capable leader. We think that this executive pay needs to be aligned with the shareholder experience. We take a lot of effort within our People and Remuneration Committee to make sure that the bonus outcomes that executives receive here are in line with the shareholder experience. If this shareholder is getting a good experience, then that should be reflected in the bonuses that are paid to executives. If they're not, then that should also be reflected in the pay that executives receive. I accept your comments, but I think leadership matters.
Thank you, Chair. I don't disagree that leadership matters. Mistakes, serious mistakes in South America have been made recently. You should also keep that in mind. But no, my point is 106 times average Australian earnings is excessively generous. Despite your comments about the process used, I'm not arguing about the process. I'm arguing about the quantum of the payments made, which are excessively generous. Thank you.
Thank you, Mr. Ivy. You've made your point very well. Thank you. Next question, please. Item Point Two.
Chair, I would like to reintroduce Ms. Linda Brooke.
Hello. I would just like to reply to the gentleman's comment when he introduced the costs of the security people. I would like to support the board in their decision today for the stewardship of their shareholders. I am 5 foot 2 and a half, and I was in my car. And I think the police numbers were justified for a number of reasons. Number one, traffic support was needed. I was glad that the road was closed. There were protesters across the road, including a very visual and somewhat interesting huge body-shaped form of a poop emoji that was blocking people walking and cars going through. So there was also, coincidentally, a caravan show that is currently being run, and so traffic was jammed. So I just wanted to say thank you, and it was warranted for the security.
Thanks for your comments, Ms. Brooke. Any further questions? No? Okay. So as there are no further questions on these items, shown on the screens are the proxy results for items 11 and 12. Item 13 is an advisory vote for shareholders to approve the 2024 Climate Transition Action Plan. We released our 2024 plan in August.
This is our second plan. The plan provides a comprehensive update. I'm sorry, is there a question? No. Thank you. The plan provides a comprehensive update on our climate change strategy and builds on our 2021 plan, which was strongly supported by our shareholders at our 2021 AGM. Our 2024 Climate Transition Action Plan explains our greenhouse gas emissions, targets, and goals, and provides an update on our progress and plans to achieve our climate change strategy, including our spend and commitments over the next decade. This plan continues our multi-decade focus on climate and is important work that will set us up to grow long-term value for shareholders. Now, as part of our climate strategy, we continue to support the development and adoption of greenhouse gas emissions reductions technologies in steelmaking.
Steel is needed to build new renewables infrastructure such as wind turbines, solar panels, and electric vehicles, and is an enabler of the energy transition. However, decarbonizing the steel sector is a complex and challenging task. There are currently no near-zero emissions technologies for iron ore-based steelmaking ready for widespread commercial adoption. Our ambition is for multiple technical pathways to mature so that our commercially feasible options are available to steelmakers in different regions. As a result, we have developed our steelmaking decarbonization project, which includes a pipeline of projects across the four pathways which we believe offer the greatest potential for near-zero emissions and at scale, so these are the blast furnace, the electric arc furnace, the electric smelting furnace, and electrolysis. But the technology required to reduce emissions across all these pathways is still developing and at different maturity levels, with some only at early pilot stage.
Our strategy is to partner with steelmakers and technology companies and support the development of technologies across all four process routes. And we're making good progress as outlined in our CTAP. We now have 50 industry partners, including nine steelmakers, 16 research institutes, and 11 technology companies. Our partnerships with steelmakers represent around 20% of reported global steel production in 2023. Now, I've engaged with investors and stakeholders throughout the year on our climate strategy and following the release of our Climate Transition Action Plan. The vote is a non-binding advisory vote that BHP has voluntarily decided to put to shareholders. Shareholders are not being asked to determine BHP's climate strategy. The board is responsible for the governance and oversight of our climate change strategy, acting in the best interests of BHP.
The advisory vote is not binding, but the board will take the outcome of the vote and the discussions into account. Going forward, there is significant change in the sustainability reporting requirements globally that will impact BHP and other global companies. We will continue to consider the right way to engage with shareholders on this important topic going forward. So do we have any questions on item 13? Question Point One, you've been waiting patiently. Go ahead.
Thank you. Chair, I would like to introduce Ms. Marianne Bowman.
Ms. Bowman, welcome.
Thank you. My question is about BHP's willingness to reduce Scope 1 operational greenhouse gas emissions at our Australian coal mines.
In an environment of ever-increasing concerns for coal mining's impact on the planet and a move to decarbonize mining across the industry, BHP investors deserve to know why the company is no longer anywhere close to leading the pack on reduction of methane emissions from coal mining and seems to have no plans to address methane emissions from its open-cut coal mines. So my question is, how is the lack of a plan to reduce operational methane emissions consistent with BHP's target of 30% reduction by 2030? And further, how can coal expansions be justified in this context?
Thank you. Great. Thank you, Ms. Bowman. I'm going to make a couple of general comments, and then I'm going to hand it over to Mike to talk specifically about methane emissions.
We have a 30%, at least 30% reduction on operational greenhouse gas emissions, which is Scope 1 and Scope 2 by 2030. Target for us means commitment. We're tracking very well against that target today. As a matter of fact, we're slightly above 30% at this point, but a lot of that has been done through Scope 2, which is converting the power that we purchase to renewable energy and therefore reducing our emissions there. We still have a lot of work to do on Scope 1 emissions, which is operational emissions, where the vast majority of our Scope 1 emissions are coming from our diesel-powered earth-moving equipment, so we use large trucks on our sites and bulldozers. They're all powered by diesel, and if we're going to be successful in decarbonizing our business, we're going to have to find a solution for that.
Now, we're well on track. As a matter of fact, we have our first electric-powered ultra-truck vehicle from Caterpillar that's in the country. It's going up to do trials. I don't know if they've already started or it's next month. Right. So it's here. The first-generation electric vehicle earth-moving truck is here, and we're pretty excited about that. And so we are making progress. We estimate that to meet our 30% reduction by 2030 target, because we're going to grow, although we're above 30% today, we're going to grow the business between now and 2030 because the world needs more of the commodities that we produce in order to continue to raise standards of living, to decarbonize, to enable all that infrastructure that we've talked about before. So we're going to grow the business between now and then, which means we're still challenged to meet that 30% target.
And to do that, we've estimated that we're going to need to spend about $4 billion between now and 2030 on operational decarbonization plans. So that's a lot of money, and it's a lot of work, a lot of engineering talent that's going into designing the systems, the technology that we're going to need to implement in order to reduce our Scope 1s. Now, that's different than the methane, the fugitive methane gas emissions, which is related to our coal operations. And just for clarity, the vast majority of BHP's coal is steelmaking coal, which is used obviously to make steel with, which is an enabler of decarbonization infrastructure. We have one energy coal asset in New South Wales, and I think as shareholders are well aware, we will be phasing that down to a just transition closure in 2030. But Mike.
So Ms. Bowman, thank you for the question, and you're right. Fugitive methane emissions are a challenge for the business. I'm happy to say that we're starting from a good base because BHP's coal mines in Queensland have less emissions or fugitive emissions relative to other coal mines. Our starting base is positive, but we have to continue to look at how we can mitigate them further. In coal mining, you have open-cut mines and underground coal mines, and BHP's operations are predominantly open-cut. It's actually more straightforward to mitigate fugitive emissions from an underground coal mine. At our Broadmeadow Mine, which is our underground coal mine in Queensland, we have made good progress on destroying methane through flaring or converting it to CO2.
However, in open-cut mines, it's a more challenging prospect because of lower concentrations of methane both in the coal seams and once it's vented into the atmosphere. Now, our strategy today is we do have a plan in place. It's focusing on accurate measurement, so figuring out how we can go about getting better at how we measure and forecast fugitive emissions. And then we will look at how we go about preventing and, where necessary, mitigating those emissions. But in some instances, it will rely upon development of new technologies. So just like Ken mentioned in respect of our haul trucks, we're needing to work with others to develop new ways of going about these things for us to achieve our ultimate aim of net zero.
Now, in the case of fugitive emissions, it may be that in due course, that even with advances in technologies, there will be some residual that needs to be mitigated through offsets. But the clear focus for us today is on reducing, mitigating those emissions through destruction of methane.
Thank you. Next question, please. Question Point Two.
Chair, I'd like to introduce Ms. Jan McNicol.
Thank you, Mr. Chair.
Ms. McNicol, welcome.
Thank you. It's a great privilege to talk to the BHP again. My question is about the assumptions in relation to trends in steel decarbonization. BHP has stated in the Climate Transition Action Plan that carbon capture and storage technology, the steelmaking, will be available beginning in the mid-2020s, which that's where we are.
However, as stated by the IEEFA, to quote, "It is now late 2024, and there are no commercial-scale carbon capture and storage facilities for coal-based steelmaking anywhere in the world, and virtually nothing in the pipeline." End quote. Why is BHP over-investing in a risky, unproven technology like carbon capture, utilization, and storage when there are other commercial-scale green steel technologies available that are more effective at reducing emissions? Is it because carbon capture and utilization and storage requires the ongoing use of coal and therefore a market for BHP's coal from Queensland?
I'll make a couple of introductory comments, and then I think the CEO is itching to answer this question as well. Look, as I mentioned in my introductory comments, Mrs. McNicol, decarbonizing the steel supply chain is a challenge.
We're working on four possible decarbonization pathways, as I've talked about: electric arc furnaces, electric smelting furnaces, electrolysis, and those three are in development. Now, you can do green steel today with an electric arc furnace, but you need to use recycled steel to do so and renewable energy. Then you can make green steel today. The problem is that there isn't enough recycled steel to meet demand going forward. So about 30% of the market today globally is in recycled steel, is manufactured through recycled steel. 70% is made with what I call new steel requiring iron ore and metallurgical coal. That's going to continue going forward. So we need to find a solution to decarbonize the new steel pathways. Electric arc furnaces can be used, but not with recycled steel. It needs to be done with iron ore through a DRI process.
About 5% of the world's iron ore is of the quality capable of doing that. So that's not really going to solve our problem. Then the electric smelting furnace can use iron ore of all grades today. And so we think that's probably a pretty good shot. And we're spending quite a bit of money with BlueScope, with Rio Tinto, on pilot-level technology to try to see whether we can unlock that one. And electrolysis, we've made some investments in some emerging companies, but it's kind of over the horizon. And so today, what you have is the blast furnace, which is incredibly cost-effective and flexible, but it emits. And so we're working on a number of programs in order to try and reduce the emissions of the existing process. Some of it is just raw material optimization. Some of it is process optimization.
Yes, unapologetically, we're looking at CCUS because it's a potential solution to create near-zero blast furnace-based, which is the dominant technology out there today. It has the possibility of, and what we mean CCUS, carbon capture, utilization, and storage. If we can capture those emissions from the existing process, optimized process, then we might have an opportunity at net zero technology. Now, to your point, I don't know if this is what Mike's going to cover, but there are CCUS steelmaking operations out there today. There's one in the UAE capturing up to 800,000 tons per annum of carbon dioxide. It's up and running. Nine out of ten of our customers have CCUS roadmaps. ExxonMobil is planning a project in the U.S. to capture another 800,000 tons per annum from a Nucor steel plant.
In China, one of our biggest customers, Baowu, also is working on a CCUS project. Then finally, in Europe, ArcelorMittal is also working on a CCUS facility for Ghent in Belgium. That's being developed alongside the Tata Group in India. Look, it's a challenge. I accept that. There is no silver bullet here. I accept that. We're working on all four possible pathways to try to unlock it. CCUS, at this point, given that the vast majority of steelmaking is done through blast furnaces with metallurgical coal, is a potential solution, and we just don't think it should be discounted at this point.
I was just going to reiterate what you said, Ken, which is that if the premise of the question is that we're disproportionately backing CCUS, that simply isn't the case. We're technology agnostic.
We're backing a range of different technologies. In fact, through our ventures arm, so we have a venture finance facility within BHP, we're backing a number of breakthrough steel technologies that do not require the use of coal. So we're right at the front end of backing companies with bright ideas who maybe can make a breakthrough in this space. But at the same time, we're working with major steel mills around the world, accounting for 20% of global steel production, and we're being led to some extent by their efforts. So these are people that understand their business.
They're investing in CCUS, but we're also investing with them in hydrogen injection into the blast furnace, better use of or better quality raw materials and so on that allow them to reduce their emissions footprint as they progress towards truly green steel, which, again, we're involved with at the front end through our ventures arm and our partnerships with steel mills.
Thank you.
Thank you.
Thank you. Next question, please.
Chair, I'd like to introduce Ms. Maree Le Roy.
Thank you.
Ms. Leroy, welcome.
Good morning. Thank you. It's still morning, I think, isn't it? Yes, just. I would like to ask a question about BHP's proposed expansions of its coal mines in Queensland. With its partner, Mitsubishi, BHP is currently seeking expansions of its operations at Caval Ridge, Peak Downs, and Saraji East.
If approval is granted for these expansions that will allow the company to mine over two billion tons of additional coal, it will mean that the company is still mining coal in the year 2116 when BHP CEO Mike Henry will be 150 years old. Hopefully. The Climate Transition Action Plan is not transparent about these proposed expansions. So my question is, what is the status of these proposed expansions? If BHP is hoping to achieve approvals for these mines, how is two billion tons of additional coal compatible with achieving a pathway to 1.5 degrees?
Mike, do you want to handle that one?
Sure. So I think the expansions you're referring to are actually a continuation of operations. So these are very long-term mines. And as you progress the mine life, we have to get ahead of that and submit planning approvals for continuation of the mines.
Now, we do work on a scenarios basis within the company. So we are very committed to the targets that we've put in place for our operational emissions and, in fact, working with others to achieve net zero on Scope 3 as well. But at this point in time, the technologies are not available for the reasons that Ken outlined earlier to move to truly green steel. So even as we back efforts that would ultimately see the use of coal in steelmaking fall away, we recognize that for the foreseeable future, and that foreseeable future is likely to be decades, and that's not just our forecast, it's the forecast of others, coal is likely to be required, and we believe we have a role to play in that.
One of the reasons for that is that the coals that BHP now produces result in lower carbon emissions from the steelmaking process than other coals. Because as we've changed or optimized our portfolio, we've moved to the coals very deliberately that will have the lowest emissions footprint because we believe that steelmakers are going to, there will be greater demand for those coals from steelmakers as they seek to meet their commitments in respect of decarbonization. The final point I would note, coming back to the question about expansion, is we've been very clear for other reasons that we're not investing in any growth in the coal business here in Queensland because we don't believe that the economic terms or the fiscal terms and the risk associated with that are attractive relative to the other opportunities that we have in the BHP portfolio.
Okay, thanks. Call me a cynic, but 90 years of additional coal mines doesn't sound like we're rolling it back in. Thank you.
Next question, please.
Chair, I would like to introduce Dr. John Sheridan.
Welcome, Dr. Sheridan.
Thank you and good morning. I'm a public health physician, and I'm representing ShareAction. ShareAction is a major British nonprofit that campaigns for responsible investment to tackle social and environmental issues. My question relates to BHP's action on air quality. Worldwide, air pollution is a major cause of death and disease, contributing to the deaths of at least seven million people annually. This equates to one in eight deaths globally. As ShareAction explains in its recent investor briefing, Clearing the Air, air pollution is not only physically harmful to the global population, but also places immediate and long-term financial risks on companies like BHP and their shareholders.
Your activities have a significant impact on the air that we breathe. Many of your peers in the mining industry have recognized this and are in the process of engaging with ShareAction. ShareAction notes from the BHP annual and sustainability report that you already disclose toxic air pollutants from point sources as per your adherence to the GRI and SASB indices. ShareAction has also seen the dedicated section you have included for issues regarding toxic pollutants and how they are managed. However, more progressive action must be taken to protect the world from the severe impacts of air pollution. Forward-thinking companies are starting to recognize that their air pollution responsibility extends beyond complying with existing regulations. We would like to see you, BHP, seize the opportunity to set the bar high amongst your peers and become a global leader on tackling air pollution.
My question is, will you commit to meeting with ShareAction's Long-term Investors in People's Health Group to discuss this further? Thank you.
Great. Well, thank you for your comments, Dr. Sheridan. Look, I think, again, this is the right place to be talking about this. In our Climate Transition Action Plan, if you've read it, you'll know that the vast majority of BHP's Scope 1, 2, and 3 emissions, when you look at the entirety of our emissions, greenhouse gas emissions, they're Scope 3. So we're actually quite a small emitter of greenhouse gas emissions operationally through Scope 1 and 2. It's Scope 3, and in steel in particular, where the vast majority of our emissions are. I think it's over 90%, something like that. So that's what we're focusing on.
All the discussions that we've been having with previous questions is about reducing the emissions in the greenhouse gas emissions in that supply chain. I'm not familiar with your organization, but again, I'm just trying to think which is the most. Vandita, Vandita stand up for a second, sorry to do this to you. But Vandita, if you would like to meet with Dr. Sheridan afterwards, that would be terrific, and she can take up the discussion with you further. Thank you.
Thank you. I'm aware it's Scope 3. That's Scope 3 emissions are the ones that, of course, we're concerned with. It's the fine particulates. Thank you.
Thank you, Dr. Sheridan.
Speaking lately last night, coal expansions are destined. Hang on to Ford, 2 billion tons of coal BHP. If you care about climate change, no more coal, no more coal expansion. Listen to our Pacific leaders. Coal mining is a destination. Climate action now. Coal is a death sentence. Climate action now. Coal is a death sentence. Climate action now. Coal is a death sentence. Climate action now. Coal is a death sentence. Climate action now. Coal is a death sentence. Climate action now. Coal is a death sentence. Climate action now. Coal is a death sentence. Climate action now. Coal is a death sentence. Climate action now.
Next question, please.
Chair, I'd like to introduce Ms. Emily Dixon.
Ms. Dixon, welcome.
Good morning. Thank you. So my question relates specifically to the goal of 30% reduction in greenhouse gas emissions by 2030 and using 2020 as the benchmark year. What is the justification for choosing 2020 as the benchmark year? It seems a very unambitious benchmark.
Well, as I recall, we set 2020 as the benchmark year because we set the target in 2020.
So that seemed like the appropriate starting point on which to base the target for 2030. How we determine the at least 30% reduction by 2030 target, which, again, as I mentioned, means commitment for us, not ambition, was to use the absolute contraction method, which is to make sure, because we are believers and supporters around the Paris Accord, we want to make sure that we are doing our part to align with the ambition of the Paris Accord. And so the absolute contraction method that we utilize is to make sure that we're contributing in line with other sectors to make sure that we're going to be aligned with the Paris Accord. Next question, please. Question Point Two.
Chair, I would like to introduce Ms. Fiona Deutsch.
Ms. Deutsch, welcome.
Oh, thank you. Good morning, Chair and Board. Stefanie, it's lovely to see you again.
My name is actually Dr. Fiona Deutsch. I'm a lead analyst at the Australasian Centre for Corporate Responsibility, or ACCR. I was also the lead author of ACCR's global studies on the insights in the green steel transformation, which has been highly regarded by academics, investors, and companies globally. My question today is about BHP's steel decarbonization investments. Chair, I'd like to firstly acknowledge the enhanced disclosures around steel decarbonization the company has made this year, particularly on forward spend, including the direct spend of $75 million committed over the next five years and an estimated $420 million in total co-investments over nine years. These are positive steps.
However, as you've noted, steelmaking is responsible for 83% of BHP's Scope 3 emissions, and the direct spend of $75 million planned for the next five years is notably lower than the $140 million that has been spent in the previous period directly. Now, we recognize that partnerships are key to this transition, and BHP cannot do this alone, but reducing your direct investment now could risk falling behind your competitors who are currently ramping up their efforts in steel decarbonization now. So given the global shift towards green steel and BHP's significant role in this transition, how does the board view the opportunity for increasing these direct investments in emerging green steel technologies to keep pace with your competitors? And what is BHP's strategy to remain at the forefront of this transition? Thanks.
Great. Thank you. Dr. Deutsch, thank you for your comments around the disclosure in the CTAP.
I think, among our shareholders, that's been extremely well received in the engagement that I've been doing with them, and we've been having this discussion with our shareholders around the challenges of steel decarbonization, and again, in the many shareholder meetings that we've had, everybody now recognizes that this really is a challenge going forward. At this point in the process, where we're trying to identify the right pathway to go down, and we've identified four potential pathways, and we're doing work, and I talked about the number of partnerships that we have, we're doing work in each of those four pathways, and we are directing appropriate capital towards that to try to unlock the pathway going forward. When we unlock the pathway going forward, the capital will flow, and if there's a role for us to play, if there's a commercial pathway forward, the capital will flow.
If there's a role for us to play and invest our shareholders' funds in that, then the capital will flow. I just look at what we're doing around Scope 1 and 2, our operational decarbonization side. We're going to spend $4 billion between now and 2030. That's a lot of money, but that's because we've identified the pathway and we're pursuing it. We haven't identified the right pathway yet on steel decarbonization, so we're at the front end of the funnel where we're looking at opportunities and we're trying to narrow it down to what we think will be the successful technology going forward, so I think the amount of money right now is appropriate, but again, if commercial opportunities arise going forward, then again, the capital will flow.
May I respond? Is that all right?
One more question. Sure.
Thank you. I appreciate that you must consider a balanced strategy. But with the steel industry shifting towards those fossil-fuel solutions, maintaining competitiveness may mean revisiting this strategy frequently. Could you share on how BHP monitors the investment effectiveness compared to your competition and whether there are specific market or technology changes that you're monitoring that would prompt a review of how much you're spending?
As I said, we are plugged in to the ecosystem that's working on this. And so we are at the forefront across all of these technology partnerships that we have. So we are in the front lines around this, and that's how we're keeping it at the forefront. We are involved. And look, some of this stuff wouldn't be happening without us. It's our involvement that's pulling together these partnerships and these different parties together. So we are making a difference here. Thank you. Next question, please.
Chair, I'd like to introduce Mr. Justin Goodfellow.
Mr. Goodfellow, welcome.
Thank you. Hello, everyone. With this work you're doing, this topic, I hear engagement with steelmakers and tech companies. I hear that said quite a lot. But I never hear any names of these prospective groups. When it comes to tech companies in particular I'm interested in, I never see it written down anywhere, or I never hear names mentioned. Are these tech companies that you speak of, are they big names that we would know, or are they garage-band inventors somewhere that you'd liaise with, or is it a mixture of the two, or are you happy with anyone? Or could you name some names for me to?
Sure. I'm going to hand this over to Mike. But just follow up, all of these questions have been very similar. I mean, just put in perspective, 50 industry partners, we're working with nine steelmakers, 16 research institutes, 11 technology companies. Mike, do you want to?
Yeah. So when we say technology companies, these aren't the likes of Microsoft or Google. We cooperate with them on other things, but a company like Electra, for example. So companies that are at the very front end of developing wholly green steel breakthrough technologies. There's others we're involved with, one other whose name escapes me, but it's those sorts. And they're securing Boston Metal. That's right. Thank you, Ken. They're securing funding from a range of different parties. It isn't somebody working just on a laptop with only funding from BHP. They've been through a series of rounds of securing venture funding, and we've participated in that. And sometimes we've participated in a second round for these companies as well.
Thank you. Are there any further questions? I don't see any further questions. So we're going to show the proxy results for item 13 on the screen. Okay. As there are no further questions on these items, that brings us to the end of the formal business of today's meeting. Thank you, ladies and gentlemen, for attending today and for your questions. We value your comments and feedback, and we'll continue to work for ongoing improvement on your behalf. The poll will close in five minutes after the conclusion of this meeting. So if you haven't already done so, please complete your voting now. Results of the meeting will be announced to the stock exchanges shortly after the conclusion of today's meeting and will be published on our website. Ladies and gentlemen, I now declare the meeting closed.
Subject to finalization of the poll, we now invite you to join your board and management team for refreshments. Thank you for joining us today.
I want you to get together.