Mon, Mar. 16, 5:58 PM
- BHP Billiton (NYSE:BHP) outlines its plan to spin off the new company called South32, saying shareholders will vote May 6 on a proposal to offer investors one share in the separate company for every BHP share.
- BHP says South32 will distribute at least 40% of its underlying earnings as dividends to shareholders, and reiterates it will not re-base its own dividend lower following the de-merger.
- BHP last year announced its intention to spin off nickel, aluminum and other properties that would allow it to focus on fewer resource operations in what would be one of the biggest de-mergers in mining history.
Wed, Mar. 11, 12:41 PM
- Cliffs Natural Resources (CLF -7%) CEO Lourenco Goncalves says global iron ore miners should rethink plans to aggressively ramp up supply of the commodity, believing the consequences for Australia could be especially severe.
- Iron ore prices have been cut roughly in half to US$58/metric ton over the past year because of increased exports from Australia's Pilbara region, and Goncalves says a further fall to $30 could lead to "Australia going out of business as a country, because [iron ore] is the most important commodity."
- Low-cost Australian exporters BHP Billiton (BHP -1.1%) and Rio Tinto (RIO -0.6%) say that if they don't raise production then someone else will, but Goncalves calls the strategy "self-destruction."
Tue, Mar. 10, 11:59 AM
- Top execs at the world's two largest mining companies - BHP Billiton (BHP -3.7%) and Rio Tinto (RIO -2.3%) - say they believe China's hunger for iron ore is not ready to fade, even as the price hit new lows after the country lowered its economic growth forecast to ~7% for 2015 vs. 7.4% growth last year.
- BHP iron ore president Jimmy Wilson says iron ore demand from China's manufacturing sector had been running above BHP's expectations in recent months, echoing comments from Rio's iron ore chief Andrew Harding, who expressed optimism China's government can maneuver the economy into a new stage of growth.
- Harding says China's steel production only needs to rise 1%/year - in line with its estimated growth last year - for the country to reach 1B tons of crude steel output around 2030.
- Earlier: BHP's Wilson stands by iron ore expansion amid glut
Tue, Mar. 10, 8:28 AM
- BHP Billiton (NYSE:BHP) iron ore boss Jimmy Wilson is out in defense of the company's strategy of boosting iron ore output at a time of falling prices and global oversupply.
- "If we pull back our volume, that volume will be filled by other companies... We [would] be penalizing, in essence, our shareholders," Wilson argues, signaling no change of course from BHP even as prices drop.
- "The big guys are saying: ‘We’ve got huge margins, so we’ll keep pumping out iron ore because we’re still making money’,” says a top economist at Westpac Banking.
- Iron ore prices have cut in half over the past year as rising supply from new and expanded mines outpaces demand from steelmakers.
- Premarket: BHP -3%, VALE -2.7%, RIO -1.4%.
Fri, Mar. 6, 8:25 AM
- Iron ore tumbles to a six-year low after China lowered its economic forecast, renewing concerns about its appetite for the steel-making material at a time when supplies are already outpacing demand.
- Steel demand growth in China - which buys three in every five tons of iron ore traded by sea - last year already was at its slowest in more than a decade.
- Australian iron ore miners have been laying off workers and cutting costs as they cope with lower prices, but they are not expected to curb production, particularly as a weaker Australian dollar helps cushion them from the impact of falling prices.
- RIO -1.4%, BHP -0.6% premarket; also VALE -0.8%.
Tue, Feb. 24, 4:58 PM
- BHP Billiton (NYSE:BHP) racked up several positives in its H1 results, but the company’s valuations and challenges stemming from its U.S. onshore petroleum and potash operations, as well as the South32 de-merger mean Rio Tinto (NYSE:RIO) may be the better stock to play a possible recovery in commodities prices, according to a Barron's profile.
- From a valuation standpoint, BHP trades at 15.4x projected earnings and 2.1x book value, while Rio trades at 13.3x projected earnings and 2.1x book, Barron's Isabella Zhong writes.
- Rio's iron ore cash cost of $19.50/metric ton is even leaner than BHP’s $20.35, and Rio has a more focused business, with a concentration on iron ore, aluminum and copper., and - unlike BHP - no exposure to oil.
Tue, Feb. 24, 12:28 PM
- BHP Billiton (BHP +5.5%) is rallying after H1 results turned out better than expected even as profits plunged against a backdrop of plummeting commodity prices.
- Despite the 47% fall in H1 profit, BHP still will raise its interim dividend by 5% to $0.62/share and pledges to maintain or increase its dividend even after a proposed de-merger later this year which will see BHP hive off some unwanted assets into the separate South32 company that analysts estimate will be worth ~$15B.
- BHP's costs have fallen faster than expected: Capital spending dropped 23% in H1, and BHP now will spend less this fiscal year and next than it had expected, cutting its original spending plans by 15% to $12.6B (£8.2B) for FY 2015 and to $10.8B in 2016.
- BHP’s aluminum, manganese and nickel business - mostly part of South32 - was the only division to improve its Y/Y operating profit, while prices for iron ore, oil and copper - the flagship commodities of the streamlined BHP - have slumped, so BHP's next task is to convince investors that it makes sense to be less diversified.
Tue, Feb. 24, 10:14 AM
- Oil production in the British section of the North Sea continued to decline in 2014 amid rising costs, high taxes and low oil prices, according to a report from an industry lobbying group which wants the U.K. government to cut taxes and streamline the complex regime for the oil and gas sector.
- British North Sea production in 2014 fell 1.1% Y/Y to 1.42M boe/day, the report says, down ~70% since the area's peak in 1999.
- The report notes that oil companies drilled only 14 exploration wells last year in the British part of the North Sea, vs. ~70 exploration wells drilled in the nearby Norwegian sector, where the government offers more generous tax incentives.
- Among the North Sea's major producers: BP, RDS.A, RDS.B, COP, E, BHP, TOT, CVX, CEO, OTCPK:BRGXF, OTCQX:BRGYY, OTCQX:REPYY, OTCPK:REPYF
Mon, Feb. 23, 5:22 PM
- BHP Billiton (NYSE:BHP) reports a 47% Y/Y drop in net profit to US$4.27B for the six months through December, down from a $8.11B profit a year earlier but ahead of analyst consensus for $3.59B.
- BHP's underlying profit for the six months, which excludes non-cash charges against assets including some oil fields in North Louisiana, was down 31% Y/Y at $5.35B; however, BHP is raising its interim dividend 5% to US$0.62/share.
- BHP says it spent $6.4B on finding and developing new deposits and in expanding existing ones, but that was 23% lower than the $8.3B it spent in the same six-month period a year earlier.
- Also says it is focusing its cap spending more on improving efficiency and reducing costs at its existing projects rather than developing new ones.
Tue, Feb. 17, 7:59 AM
- BHP Billiton (NYSE:BHP) agrees to sell its Pakistan gas business to a local firm for an undisclosed sum.
- BHP, operator of the Zamzama gas field and processing plants, has been looking to sell its 38.5% percent stake for some time, as it works to simplify its petroleum business to focus on the U.S., Australia and Trinidad and Tobago.
Fri, Feb. 13, 7:59 AM
- BHP Billiton (NYSE:BHP) says copper production from its Olympic Dam mine in Australia will be cut by 60K-70K metric tons this year, or more than a third of targeted output levels, due to repair and maintenance work.
- BHP says the Svedala mill, one of three at Olympic Dam, will be out of action for roughly six months after damage from an electrical failure in the milling process was found on Jan. 28; full production was expected to resume by the end of September.
- In January, BHP said it expects Olympic Dam to yield ~180K tons of copper in FY 2015, with maintenance work scheduled for September.
- The hit to copper production represents up to 3.9% of current guidance for the metal in BHP's financial year through June, with corresponding reduction in the production of gold and uranium at the mine.
Wed, Feb. 11, 2:38 PM
- Iron ore miners in the next few months will have the opportunity to bid for the northern half of the Simandou deposit, one of the world's most sought-after iron ore deposits, Guinea's mining minster tells WSJ.
- The official claims he is not concerned that weak iron ore prices will affect the bidding for the assets, saying it could be at least five years until the mines actually begin producing.
- The Simandou deposits are at the heart of an international legal dispute: Guinea last year stripped the rights to mine the deposit from Vale (NYSE:VALE) and the mining arm of Israeli tycoon Beny Steinmetz’s conglomerate, with the government alleging that the rights were obtained through corrupt practices.
- The blocks once were controlled by Rio Tinto (NYSE:RIO), but a previous government in Guinea revoked its rights to mine them; Rio is still helping to develop the southern part of the concession.
- Glencore (OTCPK:GLCNF, OTCPK:GLNCY) CEO Ivan Glasenberg has criticized the over-production of iron ore, but the company has held discussions with Guinean officials about mining rights in Simandou.
Mon, Feb. 9, 5:58 PM
- Some oilfield operators have consistently shown an ability to increase production per well, so the decrease in rig count does not proportionally correlate to a change in production, says NavPort's Eric Foster, who has collated oil well and rig data.
- In a case study focusing on horizontal shale wells in the Eagle Ford basin in Texas, NavPort found that Pioneer Natural Resources (NYSE:PXD) was easily the most efficient fracker last year, with average boe per well during the first 180 days of production of ~142K barrels; ConocoPhillips (NYSE:COP) and Marathon Oil (NYSE:MRO) were the other two companies with 100K-plus boe/well.
- Murphy Oil (NYSE:MUR) showed the greatest efficiency improvement during 2014 among the top 10 Eagle Ford basin oil producers; the only producers in the top 10 showing declines in production per well were BHP Billiton (NYSE:BHP) and Rosetta Resources (NASDAQ:ROSE).
Tue, Feb. 3, 10:24 AM
- Copper prices are on track for their biggest gains since September on speculation that China would use stimulus measures to jump-start its economy and boost demand for the metal.
- Rising oil prices and Chinese stimulus speculation “have changed the focus to the upside and the short-covering has done the rest,” says Saxo Bank's Ole Hansen, adding that “energy is such a big and important part of the commodity sector, and the somewhat improved sentiment there also helps other” raw materials; aluminum and nickel also are rising to multi-week highs.
- "We’re in this perverse world where bad news is good news,” says BNP Paribas analyst Stephen Briggs, and "a lot of people are thinking China’s going to join the rest of the world and lower interest rates or [offer] some kind of monetary response."
- Raw materials companies are off to a strong start today: FCX +5.8%, BHP +3.9%, RIO +2.4%, VALE +3.9%, SCCO +3.4%.
- ETFs: JJC, DBB, JJN, JJU, JJT, CPER, BOM, RJZ, BOS, LD, BDD, JJM, FOIL, NINI, CUPM
Fri, Jan. 30, 7:43 AM
- BHP Billiton (NYSE:BHP) says it plans to trim its workforce at the Olympic Dam copper and uranium mine in southern Australia in an attempt to reduce operating costs amid softer commodity prices.
- A leading area politician reportedly says 300 workers would be cut.
- BHP says it cannot provide a net figure for exactly how the changes would affect its total head count at the mine, which employs ~4,300 people, until later in the year; BHP has planned to increase copper output from the mine in the second half of the year.
Tue, Jan. 27, 11:47 AM
- U.S. exports of condensate have been given an important boost by Enterprise Products Partners (NYSE:EPD) agreements for contracts with at least two major trading companies to sell the light crude, according to a Reuters report.
- EPD has contracts with Mitsubishi's Petro-Diamond Singapore oil trading arm and independent oil trader Vitol for 1.2M bbl/month of U.S. condensate in 2015, trade sources say, which should give it a head start before other companies win approval to export condensate produced from shale operations.
- Royal Dutch Shell (RDS.A, RDS.B) also has approvals to export U.S. light crudes, while ConocoPhillips (NYSE:COP) is seeking a license and BHP Billiton (NYSE:BHP) also has sold at least two cargoes.
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BHP Billiton Ltd is a natural resources company. The Company is engaged in the producing commodities, including iron ore, metallurgical and energy coal, conventional and unconventional oil and gas, copper, aluminium, manganese, uranium, nickel and silver.
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