Mike Henry has been appointed as the next chief executive of BHP, succeeding Andrew Mackenzie who is retiring at the end of the year after running the world’s biggest mining company since 2013.
In a statement, BHP said Mr Henry, a Canadian-born executive who runs its iron ore, coal and copper mines in Australia, would start his new job in January
“Mike’s deep operational and commercial experience, developed in a global career spanning the Americas, Europe, Asia and Australia, is the perfect mix for our next CEO,” said BHP chairman Ken MacKenzie.
Mr Henry joined BHP in 2003 and has run its Australian operations, including its flagship iron ore assets, since 2016. The 53-year old was one of several internal candidates tipped to replace Mr Mackenzie. These included Peter Beaven, chief financial officer, and Daniel Malchuk, head of its Americas division.
Thanks to the work of Mr Mackenzie he will inherit a much simpler business that is focused on just four commodities — copper, iron ore, coking coal and offshore oil — and 13 operated assets.
Under Mr Mackenzie, BHP spun off a group of non-core assets into a separately-listed company called South32 and sold its onshore US oil assets, drawing a line under a disastrous foray into the shale industry.
“We would like to recognise the outstanding contribution of Andrew Mackenzie to BHP as CEO. Under his leadership, BHP has transformed into a simpler and more productive company, financially strong and sharply focused on value for shareholders,” said BHP chairman Mr MacKenzie.
During Mr Mackenzie’s tenure BHP had to deal with the fallout from a dam failure at a Brazilian joint venture in 2015, which claimed the lives of 19 people and caused widespread environmental damage.
It was also forced to abandon its progressive dividend policy, under which the company was obliged to maintain or increase its payout to shareholders. The company was also attacked by activist investor Elliott Advisors, which called on BHP to drop its complex-dual-listed share structure and boost shareholder returns.
The appointment of Mr Henry, a polished presenter, suggests BHP will continue to focus on improving its operational performance and sweating its assets harder, a task started by Mr Mackenzie who recently created a so-called “transformation” office to oversee its efficiency drive.
To date, Mr Henry’s career has spanned four continents and all of BHP’s commodities. Since he took the helm of Minerals Australia, BHP has become the lowest cost major iron ore producer in the world. He also delivered several large projects as well as the company’s first full-scale autonomous haulage system at its Jimblebar iron ore mine.
However, a year ago BHP was forced to temporarily halt exports of iron ore from Australia because of damage caused by a runaway freight train that it was forced to derail.
“I am honoured and privileged to be named CEO and to have the opportunity to lead the talented and hard-working people who make BHP a great company . . . We will unlock even greater value from our ore bodies and petroleum basins by enabling our people with the capability, data and technology to innovate and improve.”
Mr Henry, who hold holds a Bachelor of Science (Chemistry) from the University of British Columbia, will be paid a base salary $1.7m per annum.
One of the big challenges facing Mr Henry will be getting Olympic Dam, a huge giant copper, uranium and gold mine in South Australia that has never delivered on its potential.
He will also have to deliver on Mr Mackenzie pledge to set public goals for reducing greenhouse gas emissions from its products even after they have been sold decide whether to go ahead with a multibillion-dollar potash project in Canada.