BHP Billiton announcedlast week that the expansionof Olympic Dam would bepostponed, until thecompany can find a moreeconomical way to moveforward.
The announcement camefrom BHP’s chief executiveofficer Marius Kloppers lastWednesday, who citedinternational commodityprices as a main reason forthe stand still.
“As we finalised all thedetails of the project in thecontext of current marketconditions, our strategy andcapital managementpriorities, it became clearthat the right decision forthe company and itsshareholders was tocontinue studies to develop aless capital intensive optionto replace the undergroundmine at Olympic Dam,” MrKloppers said.
BHP Billiton’s chiefexecutive non-ferrousAndrew Mackenzie said theSouth AustralianGovernment’s support forthe project should becommended.
“The South AustralianGovernment has been fullysupportive of Olympic Damand has created anenvironment that is highlyconducive to businessinvestment,” he said.
“We have been very muchencouraged by their attitudeto business developmentand the Olympic Damexpansion project.”
The company minescopper, uranium, gold andsilver at Roxby Downs andthe $30 billion expansionwould have seen OlympicDam grow to be the largestopen-cut mine in the world.
Olympic Dam has thelargest known deposit ofuranium in the world.
The decision came aftermonths of speculation thatthe BHP would notannounce a definitive on theexpansion by the end of theyear.
As a result of lastweek’s announcement, BHPwill not be ready to approvean expansion of OlympicDam before the indentureagreement deadlineDecember 15, 2012.
The company will discussthe implications of thisdecision for the indentureagreement with the SouthAustralian Government inthe coming months.
DEFERRED: BHP Billiton has postponed its expansion plans due to the world markets.