Antinuclear

Miners want 15% profit – Olympic Dam uranium mine expansion might not proceed

Broker casts doubt on viability of Olympic Dam expansion, Sydney Morning Herald, BARRY FITZGERALD, June 17, 2010
BHP BILLITON’S proposed Olympic Dam expansion in South Australia’s outback could have no ”economic value” under the Rudd government’s hotly debated proposal to subject resource company super profits to an additional 40 per cent tax

……. the assessment of mining analysts at Morgan Stanley, ”Our modelling of this project shows that the resource super profits tax reduces the net present value of the project to an extent that it becomes negative, and return on invested capital falls below the minimum hurdle rate of 15 per cent used by the mining industry.

BHP Billiton’s managing director, Marius Kloppers……. said that although BHP had not shelved or frozen projects in response to the proposed tax, Olympic Dam was the sort of high capital expenditure project with long lead times that was ”most disadvantaged”……But BHP has yet to commit to the project. Approval from the SA, Northern Territory (ore is exported from Darwin) and federal governments is needed and is planned for the first half of next year. The final proposal with all the permits and conditions attached is then likely to go before the board in the latter half of next year.

June 17, 2010 - Posted by Christina Macpherson | AUSTRALIA - NATIONAL, politics, uranium | antinuclear, Australia, BHP, BHP Billiton, nuclear, nuclear costs, nuclear wastes, uranium