BHP and Cobre will collaboratively explore for copper deposits in Botswana

Mining behemoth BHP (ASX: BHP) has formalized an agreement to establish a joint venture with Australian copper explorer Cobre, aimed at discovering premier-grade copper-silver deposits, categorized as Tier One, in Botswana. Tier One deposits are deemed "game-changing assets" due to their sheer size, low operational costs, and extensive mine lifespan. In the copper industry, these assets typically boast reserve potentials exceeding 5 million tonnes of copper and maintain cash costs positioned in the lower echelon of the industry's cost curve.

This collaboration stems from Cobre's impressive performance in BHP's Xplor program, which not only supported Cobre but also funded a recently concluded seismic survey on the Kitlanya West project. The earn-in arrangement further encompasses Cobre's East Copper project, both situated within Botswana's renowned Kalahari Copper Belt.

The joint venture with BHP presents Cobre with unparalleled exploration proficiency and significant scale, thereby enhancing the prospects of major discoveries within the exploration territory. Notably, Cobre will maintain full ownership of its Ngami and Okavango Copper projects, which are excluded from this proposed transaction.

"Securing and closing this transformative transaction with BHP marks a pivotal milestone for Cobre," declared CEO Adam Wooldridge in an official statement.

Since Mike Henry assumed leadership at BHP in 2020, the company has been on the hunt for substantial copper assets. This quest has led to the miner's largest acquisition in a decade through the purchase of Oz Minerals and an unsuccessful $49 billion bid for competitor Anglo American (LON: AAL).

Recently, BHP forged an alliance with Lundin Mining (TSX: LUN) of Canada to acquire Filo Corp. (TSX: FIL), a South America-focused company, thereby gaining crucial copper assets in Chile and Argentina.