Top global miner BHP Billiton shelved its planned $20bn (£12.7bn) Olympic Dam copper expansion today as it reported a 35 per cent slide in second-half profit in the biggest sign of the pain inflicted by the slowdown in China's economic growth.
BHP reported its first annual profit fall in three years in the face of rising costs and falling commodity prices, wrapping up a torrid earnings season for the world's biggest miners.
They were all battered by weaker prices for iron ore, copper, coal, nickel and aluminium as economic growth in big-buyer China slows to its weakest pace in a decade.
BHP chief executive Marius Kloppers said the company needed to take a fresh look at the massive Olympic Dam expansion, which had been due for a final decision in December, in light of the tough market conditions.
"As we finalised all the details of the project in the context of current market conditions, our strategy and capital management priorities, it became clear that the right decision for the company and its shareholders was to continue studies to develop a less capital intensive option to replace the underground mine at Olympic Dam," he said.
The Anglo-Australian giant has also been hurt by lower natural gas prices and industrial action at its coking coal mines, with its bottom line marred by $2.5bn in writedowns on its shale gas and nickel assets and charges on projects, including Olympic Dam.
City A.M. Reporter