BHP Billiton Chief Executive Officer Marius Kloppers thinks that making acquisitions is still very much on the cards for the mining giant. Its hostile takeover bid for Rio Tinto in 2008 may not have worked and its PotashCorp takeover bid may have been shot down by the Canadian government but they are still looking forward to new opportunities.
Speaking on television program Inside Business Mr Marius Kloopers said that while some industries like iron ore may face regulatory constraints for non organic growth there were others like potash, copper, oil and gas that had no such constraints. He said that while cycles changes every six months there are going to be large opportunities in the oil and gas market going forward.
He added that the company had already slated $ 80 billion to new project development and expansions on existing projects over the next five years.. Money would be spent on five main heads these include the Olympic Dam project, the Bowen Basin mining activities, Iron Ore facilities in West Australia, oil and gas industry and on potash mines in Canada.
He also said that the high iron ore prices could only be maintained for about another two years. They were also waiting for asset prices to come down a bit before making acquisitions that will help their already fast growing profile. Analysts have been expecting BHP Billiton to make inroads into the oil and gas industry in the US market with Woodside Petroleum, or other companies that may fit the bill such as Anadarko, Cobalt, Noble Energy or Plains.
Mr Kloppers has just returned from Mongolia where he attended the annual Naadam festival. He was a guest of honour in a yurt and his host and friend Edward Rochette said that it was an opportunity for him to enjoy himself and let his hair down.
The welcoming attitude of the Mongolians to the mining giant’s chief executive reflects the many aspirations that the landlocked but mineral rich developing economy has. The nation has seen much foreign investment to help develop its vast natural resources and Rio Tinto itself is spending to the tune of $7 million a day as per Andrew Harding the head of the company’s copper division who is overseeing the Oyu Tolgoi project.
Oyu Tolgoi will become one of the three top copper mines in the world and has the unique distinction of being located bang across the border from China, which is the largest copper consumer of the world. The project will bring much to the small economy of Mongolia and that is not the only mine that will do so. The coal project in Tavan Tolgoi will also get going this year. It is believed to be the second largest coal deposit in the world after the Shengli deposit located in China.