Australian mining giant BHP Group has entered a nickel supply deal with Tesla for its electric car batteries. The companies will also be collaborating to build blockchain-based supply chain technology for raw material traceability and more.
According to a release from the BHP mining group, it will be partnering with the electric car and sustainable energy company, Tesla. The supply agreement will allow Tesla to source sustainably mined nickel and reduce dependence on Indonesian suppliers who have doubled the carbon footprint.
We are delighted to sign this agreement with Tesla Inc and to collaborate with them on ways to make the battery supply chain more sustainable through our shared focus on technology and innovation.
Vandita Pant, BHP Chief Commercial Officer
Headquartered in Melbourne, Australia, BHP stated that the metal will be supplied from its Nickel West operation in Western Australia.
Demand for nickel in batteries is estimated to grow by over 500 per cent over the next decade, in large part to support the world’s rising demand for electric vehicles.
Vandita Pant
Role of Blockchain in Supply Chains
In addition to the supply agreement, BHP and Tesla will develop blockchain-based solutions to track raw materials from mines to production. By tracing materials, companies can verify the origins and production methods used to remain compliant with responsible mining practices, in turn leading to a more sustainable value chain.
A blockchain implementation also allows proof of responsible sourcing to be shared while protecting confidential or competitive information.
In Australia, blockchain technology has already been used in the food and wine industry to protect supply chains against fraud.
BHP Moving to More Sustainable Mining Practices
The global mining company which extracts and processes minerals, oil and gas has committed to cutting carbon emissions by 30 percent by 2030. BHP’s long-term target is to reach net-zero operational emissions by 2050 and has already invested US$400 million toward climate change efforts in 2019. It is working with customers to lower emissions from the steel-making industry, which is among the world’s heaviest polluters.
BHP will also collaborate with Tesla Inc on energy storage solutions to identify opportunities to lower carbon emissions in their respective operations through increased use of renewable energy paired with battery storage.
BHP produces some of the lowest carbon intensity nickel in the world, and we are on the pathway to net zero at our operations. Sustainable, reliable production of quality nickel will be essential to meeting demand from sustainable energy producers like Tesla Inc […] Our nickel is essential to a decarbonising world and Nickel West has a global advantage in the sustainable production of nickel.
Edgar Basto, President, BHP Minerals Australia
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