The contracts, with ENEL Generacion Chile and Colbun are expected to displace 3 million tonnes of carbon dioxide a year from 2022 compared to the fossil fuel-based contracts they replace.

BHP is taking a provision of US$780 million (A$1.14 billion) related to the cancellation of the existing coal contracts related to supplying that electricity.

The ENEL contracts start in August 2021 and the Colbun contracts begin in January 2022.

BHP Minerals Americas Daniel Malchuk said from a commercial perspective the contracts delivered an estimated 20% reduction in energy prices at Enscondida and Spence.

"This is an important step in our transition to sustainable energy use over the medium term in Chile," he said.

"Our path to 100% clean energy in Chile began earlier this decade when the Kelar power plant environmental permit was switched from coal to gas, enabling power supply from lower emission sources."

On the water front BHP has been working on eliminating water draw down from aquifers for operational supply by 2030.

At Spence a desalination plant with a capacity of 1000 litres per second will support the Spence Growth Option.

That plant, due on online in 2020, will allow the operations to use desalinated water as the main source of supply.

At Escondida a second desalination plant started operating in 2017 with a maximum capacity of 2500l/s.

Additional upgrades, plus connection of the original desalination plant to this conveyance system, will further increase total capacity.

"Water is critical to our operations in Chile and to the communities where we operate in the Atacama Desert," Malchuk said.

"In addition to our new desalination plant at Spence, we have also invested more than US$4 billion in Escondida's desalination facilities to further our progress to eliminate groundwater usage in Chile by 2030."