KEY POINTS
- Baowu is considering buying a 15%-25% stake in BHP’s Jimblebar mine.
- Jimblebar produced about 62.5 million tonnes of BHP-attributable iron ore in 2026.
- No deal has been agreed, amid growing scrutiny of Chinese investment in Australia.
China Baowu Steel Group, the world’s largest steelmaker, is considering acquiring a minority stake in BHP’s Jimblebar iron ore mine in Western Australia, in a potential deal that could deepen ties between China’s steel industry and one of Australia’s biggest mining operations.
According to two people familiar with the matter, Baowu is considering seeking between 15% and 25% of the mine. The proposed stake would come from BHP’s existing 85% interest, although discussions remain preliminary and no agreement has been reached.
The potential investment would give Baowu direct exposure to one of BHP’s most important iron ore assets. The Jimblebar mine, located in Western Australia’s Pilbara region, is operated by BHP, with Japanese trading houses Itochu and Mitsui holding minority interests.
The sources said there is currently no certainty that Baowu’s interest will lead to a transaction. They also did not disclose a possible valuation for the stake.
BHP, responding after the report emerged, said it has a long history of partnering with other companies across its assets and regularly considers opportunities that could generate long-term value for shareholders.
The mining giant also stressed that its Western Australian Iron Ore business remains central to its portfolio and reaffirmed its commitment to the operation and to Western Australia.
Baowu did not respond to requests for comment.
Jimblebar Is a Major BHP Asset
The proposed investment is significant because of the scale of Jimblebar’s production.
The mine produced approximately 62.5 million tonnes of iron ore attributable to BHP during the 2026 financial year. At current prices, that production would be worth roughly $6.2 billion.
Jimblebar’s output represents about one-quarter of BHP’s total iron ore production, making the operation a strategically important source of the steelmaking raw material.
BHP owns 85% of the mine, while Itochu and Mitsui hold the remaining interests. When the mine opened in 2014, BHP valued its share of the project at about $3.2 billion.
A 15%-25% interest would therefore give Baowu exposure to a large and established source of iron ore without acquiring control of the operation.
The possible transaction could also create questions about BHP’s broader strategy for selling iron ore into China, the world’s largest steelmaking market.
Some bankers familiar with BHP’s business have questioned whether selling part of Jimblebar to Baowu would fit with BHP’s efforts to maximise the value of its iron ore sales to Chinese customers.
The issue comes against the backdrop of recent tensions between Australian miners and China’s state-backed China Mineral Resources Group (CMRG), which increasingly negotiates with miners on behalf of Chinese steelmakers.
