MELBOURNE, March 11 (Reuters) - BHP Group BHP.AX is unlikely to make any major acquisitions in the near-term given rocketing commodity prices, and will instead focus on exploration and wringing more value out of existing assets, its chief executive said on Thursday.
The world's biggest listed miner is looking to grow its exposure to "future facing commodities" or those expected to be cornerstones of the world's transition towards cleaner energy.
That includes copper, whose conductive properties efficiently transport power, and nickel used in batteries for electric vehicles - for which BHP expects prices to go higher still.
"Given what we have seen over the past 6-9 months in terms of asset values in commodities like copper for example, it's unlikely that we will see acquisition in the near term because any acquisition has to be for the right assets at the right value," Chief Executive Mike Henry told an investor briefing.
"They need to compete well under the capital allocation framework, and right now that's looking a little bit tougher because of the higher asset prices so it means even more focus on exploration, early stage entry and innovation."
Unlike peer Fortescue FMG.AX which is banking on hydrogen as a major plank for future growth, Henry said that a similar move would not make strategic sense for BHP, given where its technical capabilities and risk appetite lie.
However, it is exploring hydrogen to curb emissions in its industrial processes, and to help its steelmaker customers develop technology to lower emissions.
"We believe hydrogen will have its day," Henry said. "Hydrogen in steelmaking - we see the economics as currently being quite challenging," he added.
BHP is also looking to boost the number of permanent employees to around 60-80% of total staff in the next few years, Henry said, to increase safety and productivity. Permanent staff currently make up 30-40% of BHP's total workforce, while the rest are contractors or employed through labour hire firms.
Union representatives have also pointed out that this would allow BHP to save by cutting out the middleman and standardising pay.