BHP ups spending at Pilbara

17th Nov 2010 07:31

BHP Billiton is to increase its spending on its iron ore mine operation at Pilbara, Western Australia by $635m.The investment comes a month after BHP and Rio Tinto abandoned plans to merge their Pilbara operations in the face of regulatory, customer and shareholder objections.Rio Tinto has already announced it has earmarked another $3.1bn (£2bn) for its Pilbara operations, doubling its new investment there. BHP said this latest additional spending expands on the $1.73bn announced in January 2010 and will facilitate the ongoing development of important port, rail and Jimblebar mine infrastructure."The investment further progresses our conveyor belt of Rapid Growth Projects and ensures the company is well positioned to deliver production growth into a tight and growing market. Our volume maximising strategy remains unchanged as we continue to update our longer term growth plans," BHP Billiton President, Iron Ore, Ian Ashby said.BHP yesterday said that the failure of the Pilbara merger and also its failure to snare Potash Corp of Saskatchewan had not put it off large acquisitions. BHP Billiton is estimated to have spent $875m on the $38.6bn Potash Corp bid, the failed iron ore joint venture with Rio Tinto and a previous attempt to takeover Rio Tinto. Chairman Jac Nasser says that he does not regret these costs because it is the board's obligation to pursue large transactions. on teh today announced approval for a further US$635 million (BHP Billiton share US$570 million)(1) of capital expenditure that will underpin continued growth in Western Australia Iron Ore's production profile. The investment highlights BHP Billiton's commitment to the Rapid Growth Project sequence of expansion projects and is consistent with the company's strategy to fully utilise its Port Hedland inner harbour capacity.The investment expands on BHP Billiton's earlier pre-commitment of US$1.73 billion announced in January 2010 and will facilitate the ongoing development of important port, rail and Jimblebar mine infrastructure.BHP Billiton President, Iron Ore, Ian Ashby said "The investment further progresses our conveyor belt of Rapid Growth Projects and ensures the company is well positioned to deliver production growth into a tight and growing market. Our volume maximising strategy remains unchanged as we continue to update our longer term growth plans."