BHP has agreed to a US$2 billion funding arrangement with Global Infrastructure Partners, part of BlackRock, to support the inland power network serving its Western Australia Iron Ore operations.

The deal creates a new trust entity that will be 51% owned and controlled by BHP, while GIP will acquire a 49% stake through its capital injection. In exchange, BHP will pay a tariff tied to its share of WAIO’s inland power usage over a 25-year period.

The agreement enables BHP to unlock capital while retaining full operational control over WAIO and its power assets. No ownership of WAIO infrastructure changes hands, and existing joint venture and state agreements remain unaffected.

Infrastructure monetization deals have accelerated across the mining and energy sectors as operators seek to recycle capital, strengthen balance sheets, and fund growth without ceding strategic control. WAIO — 85% owned by BHP — is pursuing a long-term plan to lift iron ore output to 305 million tonnes per year through targeted investments in mines, rail, and power systems.

For BHP, the transaction supports its capital allocation framework and adds financial flexibility as it navigates volatile iron ore markets and rising decarbonization costs. For GIP, the acquisition expands its footprint in Australian energy infrastructure, building on its US$189 billion global portfolio.

Completion is expected by the end of FY2026, pending regulatory approvals, including Australia’s Foreign Investment Review Board.

By Charles Kennedy for Oilprice.com

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