BHP to rein­vest af­ter tax dumped

Pilbara News - - News - Peter Wil­liams

BHP Bil­li­ton will push ahead with a multi­bil­lion-dol­lar Pil­bara iron ore mine be­cause WA has re­turned to a more sta­ble in­vest­ment en­vi­ron­ment af­ter the State elec­tion, the miner’s top ex­ec­u­tive in Perth says.

Iron ore boss Edgar Basto said the re­jected WA Na­tion­als plan for a $US5-a-tonne levy had jeop­ar­dised the South Flank de­vel­op­ment by mak­ing it less com­pet­i­tive with ri­val projects in the BHP port­fo­lio.

“That was go­ing to, in a way, to wait on that de­ci­sion,” Mr Basto said last week.

“The fact that we don’t have that (levy) is go­ing to be a big plus in terms of how does the project stack up com­pared with other projects in our port­fo­lio.”

He said that in a meet­ing with BHP of­fi­cials af­ter the elec­tion, Premier Mark McGowan had ruled out new im­posts on min­ers.

“The peo­ple of Western Aus­tralia sort of dis­missed the po­ten­tial pol­icy for an ad­di­tional tax and they showed it in the way they voted at the last elec­tion,” Mr Basto said.

“Those are good sig­nals that sort of tell you that peo­ple un­der­stand how im­por­tant the in­dus­try is for the re­gion.”

The min­ing lobby’s ex­pen­sive cam­paign against the pro­posed levy on BHP and Rio Tinto was a fac­tor in then Na­tion­als leader Bren­don Grylls los­ing his Pil­bara seat. The party has re­tained the pol­icy.

The 80 mil­lion tonnes-a-year South Flank project is pro­posed to re­place BHP’s Yandi mine near New­man when it be­comes de­pleted over the next five to 10 years.

Mr Basto told the con­fer­ence the in­vest­ment case was strong for de­vel­op­ing the de­posit.

BHP is yet to put a price on the project. Mr Basto said the cost would be cov­ered un­der the miner’s long-term av­er­age sus­tain­ing cap­i­tal cost of $US4 a tonne pro­duced at its WA mines, or more than $1 bil­lion a year.

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