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Elon Musk and BHP agree nickel supply agreement for Tesla

Elon Musk has previously been vocal on Twitter about the need to secure a supply of sustainable nickel

BHP Group PLC -

The world’s richest man and the world’s largest mining company are teaming up.

BHP Group PLC (LSE:BHP) has announced that it will supply nickel to Elon Musk’s Tesla Inc (NASDAQ:TSLA), which it describes as “one of the world’s leading sustainable energy companies.”

BHP will supply Tesla with nickel from its Nickel West asset in Western Australia, one of the most sustainable and lowest carbon emission nickel producers in the world.

It comes as BHP seeks to reposition itself as a future-facing company. Along with much of the mining industry, BHP is trying to align perceptions of its operations as essential to the creation of a green future.

Such emphasis means that production of commodities like nickel and copper are talked up, while output from the oil and gas division is talked down.

“Demand for nickel in batteries is estimated to grow by over 500% over the next decade, in large part to support the world’s rising demand for electric vehicles,” said BHP’s chief commercial officer, Vandita Pant.

“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.”

In addition to the supply agreement, BHP and Tesla Inc. will collaborate on ways to make the battery supply chain more sustainable, with a focus on end-to-end raw material traceability using blockchain.

There will also be a technical exchange for battery raw materials production.

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,” said BHP Minerals Australia president Edgar Basto.

“The investments we have made in our assets and our pursuit of commodities like nickel will help support global decarbonisation and position us to generate long-term value for our business.”

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