BHP Billiton pumps $9.5bn into expansion
Miner BHP Billiton has said it will pump in $9.5bn (£5.9bn) to expand its Australian iron ore and coal mining operations.
The world’s biggest miner has decided to expand its own operations and infrastructure rather than chase ambitious takeovers after three failed deals as it scrambles to meet rising demand from Asia.
The investments announced for its Pilbara iron ore project, plus its Bowen Basin and Hunter Valley coal projects, mark the first details BHP has given of a planned $80bn in investments over five years.
“This is putting meat on the bones with regards to timing, actual tonnes and the amount of capex,” said Constellation Capital Management portfolio manager Peter Chilton.
“Rio has done the same, trying to get more out of their existing assets. It’s not like making a big acquisition, these are all things they have control over and manage already,” he said.
Other major capital projects include expanding the Olympic Dam copper and uranium mine. BHP has previously announced plans to spend around $20bn on that.
Analysts estimate the massive Jansen potash project in Canada, still in the feasibility stage, could cost up to $13bn to build.