BHP Signals End to Mining Boom |
| Wall Street Journal - Aug 22, 2012 |
BHP Billiton BHP.AU -0.33%said it would postpone or scale back projects valued at more than US$50 billion, sending the clearest signal yet that the global mining boom has run its course,
BHP's plan to turn its Olympic Dam deposit into the world's biggest open-pit mining operation has been derailed by rising construction costs, declining commodity prices and a strong Australian dollar, the company said. BHP said it would look for a less costly design for the Australian mine, which had been expected to bring in billions in tax dollars and create thousands of jobs.
The Anglo-Australian company also reported a 35% decline in profit, hurt by disappointing capital investments.
BHP and its rivals have been sharpening their focus on costs and reconsidering investments as demand from China has cooled with its slowing economy. Prices for many industrial commodities are at multiyear lows. Xstrata XTA.LN -1.03%PLC has deferred US$1 billion of US$8.2 billion in capital spending planned for this year. And Anglo American AAL.LN -3.68%PLC last month said it would delay projects in order to reduce its capital spending for this year by US$500 million to US$5.5 billion.
Read Full Article from Wall Street Journal
- Posted: 2012-08-22 15:37:22
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