After years of speculation, South Australian investors have had to accept grim news: BHP Billiton’s Olympic Dam expansion will not be happening.
The resources giant this week announced that crippling development costs and weak commodity prices led to the decision to shelve its US$30bn plan to expand the mine.
The Olympic Dam expansion was expected to create 8,000 construction jobs and 4,000 permanent jobs in desert community Roxby Downs, as well as considerably more associated industry jobs in South Australian coastal ports.
The expansion would have also created the world's largest uranium mine and increased copper output almost fourfold to 750,000 tons a year. South Australia’s economy was to further benefit from a 6% addition to gross state product.
The Australian reported that the company made the announcement after reporting a 35% drop in full-year profit and a freeze on new project spending for the 2013 financial year.
BHP Billiton chief executive Marius Kloppers said the decision was motivated by the high cost of development in Australia. "The decision is almost wholly associated with, in the first instance, capital costs," he said.
Kloppers said BHP would now examine less expensive options to expand the mine, but no timeframe has been given.
Do you have more than $200k in your super fund? You could use your super to buy property - Find out how
Top Suburbs :
Get help with your investment property
Do you need help finding the right loan for your investment?
When investing in property, it is important to make sure that you not only have the lowest available rate that you can get, but also have the correct loan features for your needs.
Just fill in a few details below and we'll then arrange for a local Aussie Mortgage Broker to contact you and work out what features or types of loans are right for your needs. We'll even help with the paperwork. Plus and appointment is free.
We value your privacy and treat all your information seriously - you can check out