BHP Billiton said it will not approve any new projects until mid-2013. Due to the slowdown in demand from China led to the decline in commodity prices, cash reserves, BHP Billiton also announced that South Australia's Olympic Dam copper and uranium mine expansion plans will be dramatically reduced, while delaying the development of coal deposits in Queensland.
Just a year ago, BHP Billiton also trumpeted order the Asian thermal coal and iron ore demand capitalization, will invest $ 80 billion to expand. In order to gain a foothold in the U.S. shale gas development tide, the company has also invested more than 12 billion U.S. dollars for the acquisition of assets.
Market environment rapidly changing, however, combined with investors looking for better returns, let BHP Billiton CEO Marius Kloppers (Marius Kloppers) is facing heavy pressure. BHP Billiton stock is the lowest point in nearly three years although competitors such as Rio Tinto shares also fell sharply.
BHP Billiton last fiscal year net profit fell 35% to $ 15.42 billion, including a provision for the Olympic Dam project costs, as well as the previously announced writedowns shale gas assets in the United States and Australia nickel mine project.
However, BHP Billiton is expected that the global economy will stabilize in the first half of 2013, after which will improve, so as to provide support for commodity demand and prices. China's fixed asset investment increase will prop up demand for iron ore, iron ore business is BHP Billiton drive earnings.
Although the longer-term outlook remains optimistic, but diversified mining enterprises has been to strengthen the cost-cutting efforts, while re-evaluate the investment plan to support the weak cash flow. Rival Xstrata Mining and Anglo American have cut their capital spending plans in recent.
BHP Billiton currently has 20 projects are in progress, and a total cost of $ 22.8 billion. BHP Billiton said the company's capital is the main inputs to the next fiscal year. This means that whether the construction of a $ 10 billion project in Western Australia, to promote more exports of iron ore and advancing Canada Jansen fertilizer project decision can only be suspended for at least 10 months.
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