13/11/2012 - 11:54

BHP has more time to decide on mine

13/11/2012 - 11:54


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BHP has more time to decide on mine

Mining giant BHP Billiton has been given until 2016 to go ahead with the expansion of the Olympic Dam mine in South Australia, but the company still can't guarantee when or if the $30 billion project will proceed.

Chief executive officer Marius Kloppers said the company would continue to develop new technologies that would allow the expanded ore body at Olympic Dam, in the state's north, to be developed.

He said it was hoped those technologies could be matured and turn the ore body into "something that continues to grow and expand".

"Unfortunately there is no guarantee that these things are successful," he told reporters in Adelaide on Tuesday.

Mr Kloppers said a number of other uncertainties remained, including exchange rates, commodity prices and the developing uranium market.

"Those uncertainties are real and I cannot, just by the stroke of a pen or by commenting about them, wave those uncertainties away," he said.

Premier Jay Weatherill said the state government had agreed to extend the deadline for BHP Billiton to expand the copper, uranium and gold mine until October 2016, because it was in SA's best interest.

He said the company had committed to spending more than $650 million in SA over the next four years on substantial mine research, further environmental works and to establish a major national Aboriginal cultural event.

"BHP Billiton has recommitted itself to South Australia," Mr Weatherill said.

"The world-class resource at Olympic Dam will be unlocked, but on a longer time frame."

The state government's indenture legislation had previously demanded BHP Billiton go ahead with the Olympic Dam expansion by December last year.

Just before the deadline the company said it would not proceed, citing increased development costs and the need to prove up new technologies to ensure the project remained viable.

Mr Weatherill said he understood that Mr Kloppers could not guarantee anything in regard to future mining developments.

"Because we're talking about a time period in the future which is contingent on a number of events occurring," he said.

"So, of course it's not prudent to say it's a guarantee."

If it is fully developed, Olympic Dam has the potential to become the world's largest open cut mine, with a projected lifetime of about 100 years




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