BHP Billiton announced, 22 August, that it will not approve the expansion of the Olympic Dam copper-uranium mine in 2012. Instead, it will investigate an alternative, “less capital-intensive” design of the Olympic Dam open-pit expansion.
The expansion plans propose a new open-pit copper-uranium mine next to the existing underground mine at Olympic Dam, beginning operations as early as 2016. The expansion would have raised the mine’s copper production from around 180,000 tonnes per year to 750,000 tonnes, and its uranium production to 32 million pounds in the early 2020s.
The expansion, which received environmental approval in October 2011, has now been put on hold due current market conditions, including subdued commodity prices and higher capital costs.
BHP Billiton CEO, Marius Kloppers said: “As with any capital commitment, all investment options are scrutinised as they move through our approvals process and our highest returning projects are prioritised. Value is always our primary consideration. We believe today’s decision reflects an appropriate, prudent and disciplined course of action.”
Kloppers noted that the long-term outlook for the copper market remains “strong” and said that the company would continue to work closely with all stakeholders to refine its longer term development plans for Olympic Dam.
“Olympic Dam is a resource of enormous potential and we will continue to work on technological and design alternatives that have the potential to substantially improve the economics of the expansion, while also completing some early stage site works,” echoed BHP Billiton chief executive non-ferrous, Andrew Mackenzie.
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