JAC NASSER, chairman of BHP Billiton, said the global mining group had cut back its ambitious $80 billion expansion programme and warned of a further easing of commodity prices.
At a business lunch in Sydney yesterday, in which he was openly critical of Australia’s ruling Labor party, Mr Nasser said the “environment” had changed since the plan was first announced by Marius Kloppers, BHP’s chief executive, in February 2011.
Asked if that meant BHP would still spend $80 billion on expansion projects by the end of the 2015 financial year he said: “No”.
His comments are the strongest hint yet that BHP is preparing to delay projects because of a weaker outlook for commodity prices as Chinese economic growth slows, and escalating costs in mining.
“The tailwind of high commodity prices has contributed to record growth in the sector. Now we have a period where those tailwinds are moderating and we expect further easing over time,” said Mr Nasser. Shares in BHP fell to 4 per cent to a near three-year low of A$32.49 on Wednesday in a weak Australian stock market. – (Copyright The Financial Times Limited 2012)
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