SYDNEY, JULY 28 - BHP Billiton (BHP.AX) (BLT.L) is likely to
delay a decision on a $30 billion proposed expansion of the
Olympic dam mine in South Australia, a newspaper said, months
after it scrapped a capital spending plan citing tough economic
A decision by the world's biggest miner on whether to
proceed with the proposed expansion of its copper and uranium
mine will not be made until 2014 rather than by the end of this
year, as previously stated by the company, the Australian
reported on Saturday, citing documents it had obtained.
The document said BHP's uranium division confirmed the
deferral and said a recruitment freeze was now in place on the
Olympic Dam expansion, the single biggest investment project.
"The expansion decision has been put on hold for two years,"
a consultant's document prepared for BHP said.
BHP spokesman Antonios Papaspiropoulos wouldn't comment
directly on the newspaper report but told Reuters there was no
change in the status quo.
"Investment decisions will be taken to the board in their
own time and the relevant economic decisions taken accordingly,"
Slumping commodity prices and escalating costs have squeezed
cash flows, pushing BHP to join rival Rio Tinto (RIO.AX) in
reconsidering the pace of their long-term expansion in countries
such as Australia and Canada.
In May, BHP scrapped a five-year, $80 billion capital
spending plan, citing uncertain global economic conditions. That
included China where it supplies millions of tonnes of iron ore,
copper, and other industrial raw materials.
The Australian said a BHP spokeswoman wouldn't confirm
whether the Olympic Dam expansion project will be considered by
the board in December.
“"We will approve projects in a sequence that maximizes
value, reduces risk and balances the consideration of short- and
long-term returns," the newspaper cited the spokeswoman as
The $30 billion expansion of Olympic Dam is one of three
major BHP projects seen by analysts as vulnerable to setbacks as
markets soften. An outer harbour development at Port Hedland in
Western Australia crucial to its iron ore growth and the Jansen
potash project in Canada are also under pressure.
BHP Chief Executive Marius Kloppers told a business forum
last month that labour allocation and rising costs associated
with a strong Australian dollar were dulling the competitive
edge of some projects in Australia, where BHP employs more than
The company has until early December to give the final
go-ahead for the Olympic Dam project or it faces the need to
renegotiate state government approvals.
South Australian Premier Jay Weatherill told the newspaper
that BHP confirmed to his office on Friday that there had been
no decision made about the Olympic Dam expansion.
“"We anticipate, as we have all along, that they'll make a
decision before the end of the year," Weatherill said in a