Antinuclear

Dubious future for uranium market – will BHP pull the plug on the Olympic Dam project?

projects such as the massive expansion of the Olympic Dam copper-uranium mine in Australia and the potash development in Canada are far less certain…… Where the money is put will say a lot about their expectations for demand for specific commodities now and into the future.

 Knives Are Out, But Will BHP and Rio Cut?, WSJ, By Robb M. Stewart, May 16, 2012,    BHP Billiton and Rio Tinto have signaled that harder times lie ahead for global miners but have given little indication of where the cuts, if any, will come to the billions of dollars worth of mining projects that both have in the pipeline in Australia and globally.

Neither is backtracking on their long held view about China’s long-term demand for iron ore and coal, but it is now clear that not every expansion project is guaranteed to get off the ground in the current environment–and those that do will be phased in over a longer time period…

… “Clearly what we’ve seen over the last 12 months or so is that our projected rate of cash generation has changed. So on balance while we still want to invest throughout the cycle, it just means that our ability to do those projects will change as the cash flow generation has changed,” Marius Kloppers, chief executive of BHP, told a mining conference in Miami overnight…..
Jacques Nasser, the mining giant’s chairman, speaking in Sydney on
Wednesday made it even clearer: the US$80 billion over five years that
BHP has previously said would be invested on its mining and petroleum
businesses, is no longer a target.
“I think we should pause and take a deep breath, and wait and see
where the pieces fall out around the world,” Mr. Nasser said of the
uncertainty in Europe and slowdown in economic growth in China and
elsewhere.

The company won’t elaborate, but analysts for some time have
speculated that although investment in iron ore is almost assured,
projects such as the massive expansion of the Olympic Dam copper-uranium mine in Australia and the potash development in Canada are far less certain…… Where the money is put will say a lot about their expectations for demand for specific commodities now and into the future. http://blogs.wsj.com/dealjournalaustralia/2012/05/16/knives-are-out-but-will-bhp-and-rio-cut/

May 18, 2012 - Posted by Christina Macpherson | business, South Australia | South Australia