BHP Billiton
| Type | Public (LSE: BLT) (NYSE: BHP), (NYSE: BBL), (ASX:BHP) & (JSE: BIBLT) |
|---|---|
| Founded | Broken Hill Proprietary Company (BHP) 1895; Billiton plc 1860; Merger of BHP & Billiton 2001 (creation of a DLC) |
| Headquarters |  Melbourne, Australia |
| Area served | Worldwide |
| Key people | Marius Kloppers (CEO) Don Argus (Chairman) |
| Industry | Materials |
| Products | Iron, Diamonds, Coal, Manganese, Gold, Petroleum, Aluminium, Copper, Nickel, Uranium & Silver |
| Market cap | US$ 137.45 Billion (2008) |
| Revenue | ▲ US$ 59.473 Billion (2008)[1] |
| Operating income | ▲ US$ 23.483 Billion (2008) |
| Profit | ▲ US$ 15.962 Billion (2008) |
| Total assets | ▲ US$ 75.889 Billion (2008) |
| Total equity | ▲ US$ 39.043 Billion (2008) |
| Employees | 33,861 (2007) |
| Website | bhpbilliton.com |
BHP Billiton is the world's largest mining company.[2] It was created in 2001 by the merger of Australia's Broken Hill Proprietary Company (BHP) and the UK's Billiton, which had a Dutch and South African background.[3] The result is a dual-listed company with head offices in Melbourne and London. BHP Billiton Limited, which is the majority partner in the dual-listed structure, is listed on the Australian Securities Exchange. BHP Billiton Plc is listed on the London Stock Exchange and is a constituent of the FTSE 100 Index.
Contents |
History
Broken Hill Proprietary Company
The Broken Hill Proprietary Company or BHP was incorporated in 1885, operating the silver and lead mine at Broken Hill in western New South Wales.[4] In 1915, the company ventured into steel manufacturing, with its operations based primarily in Newcastle, New South Wales. The company's corporate offices are located in Melbourne, Victoria.[5] It is also known by the nickname "the Big Australian".[6]
The company began petroleum exploration in the 1960s with discoveries in Bass Strait, an activity which became an increasing focus.[7]
BHP began to diversify offshore in a variety of projects. One project was the Ok Tedi copper mine in Papua New Guinea, where the company was successfully sued by the indigenous inhabitants because of the environmental degradation caused by the mine operations.[8] BHP had better success with the giant Escondida copper mine in Chile (57.5% owned) and the Ekati Diamond Mine in northern Canada.[9]
The inefficiencies of what was, by global standards, a small steel operation in Newcastle finally caught up with the company and the Newcastle operations were closed in 1999.[10] The 'long products' side of the steel business was spun off to form OneSteel in 2000.[11]
In 2001, BHP merged with the Billiton mining company to form BHP Billiton, the largest mining company in the world. In 2002, the 'flat products' steel business was spun off to form BHP Steel. In 2003, BHP Steel changed its name to BlueScope Steel.[5]
Billiton
Billiton was a mining company whose origins stretch back to 29 September 1860, when the articles of association were approved by a meeting of shareholders in the Groot Keizerhof hotel in The Hague, Netherlands.[12]
Two months later, the company acquired the mineral rights to tin-rich islands of Banka and Billiton in the Indonesian archipelago, off the eastern coast of Sumatra.[12]
Billiton's initial business forays included tin and lead smelting in The Netherlands, followed in the 1940s by bauxite mining in Indonesia and Suriname. In 1970, Royal Dutch/Shell acquired Billiton and accelerated the scope of progress of this growth.[12] The tin and lead smelter in Arnhem, Netherlands was shut down in the 1980s.
In 1994 Gencor acquired the mining division of Billiton excluding the downstream metal division.[13] Billiton was divested from Gencor in 1997.[14] In 1997, Billiton Plc became a constituent of the FTSE 100 Index.[12]
Throughout the 1990s and beyond, Billiton Plc experienced considerable growth. Its portfolio included aluminium smelters in South Africa and Mozambique, nickel operations in Australia and Colombia, base metals mines in South America, Canada and South Africa, coal mines in Australia, Colombia and South Africa, as well as interests in operations in Brazil, Suriname, Australia (aluminium) and South Africa (titanium minerals and steel and ferroalloys).
In 2001 Billiton Plc merged with the Broken Hill Proprietary Company (BHP) to form BHP Billiton.[3]
BHP Billiton Mergers and Acquisitions
In March 2005, BHP Billiton announced a US$7.3 billion agreed bid for another mining company WMC Resources, owners of the Olympic Dam uranium mine in South Australia, nickel operations in Western Australia and Queensland, and a fertiliser plant also in Queensland. The takeover achieved 90% acceptance on 17 June 2005, and 100% ownership was announced on 2 August 2005, achieved through compulsory acquisition of the last 10% of the shares.[15]
On November 8, 2007, BHP Billiton announced it was seeking to purchase rival mining group Rio Tinto Group in an all-share deal. The initial offer of 3.34 shares of BHP Billiton stock for each share of Rio Tinto was rejected by the board of Rio Tinto for "significantly undervaluing" the company. It was unknown at the time if BHP Billiton would attempt to purchase Rio Tinto through some form of hostile takeover[16]; however, CEO Marius Kloppers met with many of Rio's shareholders since the announcement and reiterated that the offer for Rio was "compelling" and that BHP Billiton is very "patient." [17] A formal hostile bid of 3.4 BHP Billiton shares for each Rio Tinto share was announced on February 6, 2008. [18] The bid was withdrawn on November 25, 2008 due to a global recession. [19]
On May 14, 2008, BHP Billiton shares rose to a record high of AU $48.90 after speculation that Chinese mining firm Chinalco was considering purchasing a large stake. BHP representatives refused to comment.[20]
On November 25, 2008, BHP Billiton announced that it would drop its $66 billion takeover of rival Rio Tinto Group saying that the "risks to shareholder value" would "increase" to "an unacceptable level" due to the global financial crisis.[21]
Operations
The company operates a wide variety of mining and processing operations in 25 countries, employing approximately 38,000 people.
The company has nine primary operational units:
- Iron ore
- Manganese
- Petroleum
- Aluminium
- Base Metals (primary products include copper, lead, zinc and uranium)
- Metallurgical Coal
- Thermal Coal
- Stainless Steel Materials (nickel and cobalt)
- Diamonds & Speciality Products (diamonds and titanium minerals)
Corporate structure
The Australian BHP Billiton Limited and the British BHP Billiton Plc list separately with separate shareholder bodies but they operate as one business with identical boards of directors and a single management structure. The headquarters are in Melbourne, Australia. The company has other key offices in London, Perth, Johannesburg, Santiago, Singapore, Shanghai, Houston and The Hague.
The company's shares trade on the following exchanges:[22]
- BHP Billiton Limited
- BHP Billiton plc
Management
After the merger between BHP and Billiton in 2001, Brian Gilbertson of Billiton was appointed CEO. In 2003, after just six months at the helm, he abruptly stepped down, citing irreconcilable differences with the boards.[23]
Upon Gilbertson's resignation, Chip Goodyear was announced as the new CEO. He continued in that role until his retirement on September 30 2007. Marius Kloppers is his immediate successor CEO.[24]
Angola accident
Inclement weather caused a BHP Billiton helicopter to crash in Angola on November 16, 2007, killing the helicopter's five passengers, including BHP's chief operation officer in Angola, David Hopgood. The helicopter went down about 80 km/50 miles from Alto Cuilo Camp, a diamond mining site the employees wanted to visit. BHP Billiton responded by suspending operations in the country. The company is investigating the incident.[25]
Mines and processing facilities
- Algeria
- Ohanet gas field
- ROD gas field
- Angola
- Diamond exploration
- Australia
- George Town, Tasmania
- Groote Eylandt, Northern Territory
- Kalgoorlie, Western Australia
- Kambalda, Western Australia
- Kwinana, Western Australia
- Leinster, Western Australia
- Mount Keith, Western Australia
- Mount Whaleback, Western Australia
- Worsley, Western Australia
- Ravensthorpe, Western Australia
- Griffin, Western Australia, 45% owned
- North West Shelf Venture, Western Australia, 16.67% LNG phase, 8.33% domestic gas phase
- Port Hedland, Western Australia
- Yandi, Western Australia
- Ore Body 18 , Western Australia
- Ore Body 23/25 , Western Australia
- Jimblebar , Western Australia
- Mining Area C , Western Australia
- Yarrie , Western Australia
- Cannington, Queensland
- Broadmeadow, Queensland
- Goonyella/Riverside, Queensland
- Peak Downs, Queensland
- Norwich Park, Queensland
- Saraji, Queensland
- Gregory/Crinum, Queensland
- Blackwater, Queensland
- Yabulu, Queensland, nickel refinery
- Olympic Dam, South Australia
- Hunter Valley, New South Wales
- Appin, New South Wales
- Elouera, New South Wales
- West Cliff, New South Wales
- Dendrobium, New South Wales
- Minerva offshore, Victoria, 90% owned
- Bass Strait, Victoria, 50% owned
- Brazil
- Alumar aluminum smelter/refinery - Sao Luis
- Samarco iron ore mine and pelletizing plant - Belo Horizonte
- Canada
- Ekati Diamond Mine
- Potash Development, Saskatchewan
- Chile
- Escondida
- Cerro Colorado
- Spence
- Colombia
- Cerrejón, 33.3% owned coal mine in Guajira department
- Cerro Matoso, ferronickel mine in Córdoba department
- Guinea
- Sangaredi 33.3% interest in bauxite mine and alumina refinery (currently in feasibility study)
- Indonesia
- Wetar gold mine
- Iraq
- Halfaya oil field
- Mozambique
- Mozal, aluminum smelter
- New Zealand
- Glenbrook, steel mill
- Pakistan
- Zamzama gas field
- Papua New Guinea
- (until 2002) Ok Tedi Mine, copper, cause of a large-scale ecological disaster down the Ok Tedi and Fly rivers
- Peru
- Antamina
- South Africa
- Bayside, 100% owned aluminium smelter in Richards Bay
- Hillside, 100% owned aluminium smelter in Richards Bay
- Ingwe Coal, comprises several coal mines in the Witbank area in Mpumalanga
- Manganese Metal Company, largest electrolytic manganese production facility in the world situated in Nelspruit, Mpumalanga
- Metalloys manganese production facility in Meyerton area in Gauteng
- HMM (Hotazel Manganese Mines) including Mamatwan and Wessels mines near Hotazel in the Northern Cape
- Suriname
- Kaaimangrassie bauxite mine
- Coermotibo bauxite mine
- Caramacca bauxite mine
- Klaverblad bauxite mine
- Trinidad & Tobago
- Angostura oil & gas field
- United Kingdom
- Liverpool Bay oil & gas field
- USA
- New Mexico Coal Company, coal mine in New Mexico consisting of San Juan and Navajo mine
- Southwest Copper, Arizona
- San Manuel, Arizona
- Pinto Valley, Arizona
- Resolution, Arizona
The United Nations Environment Programme has noted that BHP’s Ok Tedi mine site’s “uncontrolled discharge of 70 million tonnes of waste rock and mine tailings annually has spread more than 1 000 km (621 miles) down the Ok Tedi and Fly rivers, raising river beds and causing flooding, sediment deposition, forest damage, and a serious decline in the area's biodiversity.[26] The resulting devastation caused by the mining of Ok Tedi has included the loss of fish, a vital food source for the local community; loss of forest and crops due to flooding and; the loss of “areas of deep spiritual value for villagers are now submerged in mine tailings.”[27]
See also
- Ok Tedi Environmental Disaster
References
- ↑ "BHP Billiton Key Information FY2007" (PDF).
- ↑ "Another record profit for BHP", ABC News (2007-08-22). Retrieved on 2007-08-23.
- ↑ 3.0 3.1 BHP Billiton merger confirmed
- ↑ Australian Business Records
- ↑ 5.0 5.1 BlueScope Steel
- ↑ Shrinking the Big Australian
- ↑ History of Petroleum Exploration in Victoria
- ↑ The big, ugly Australian goes to Ok Tedi
- ↑ Discovery of Diamonds in North West Territories
- ↑ Steel City without the Big Australian
- ↑ One Steel
- ↑ 12.0 12.1 12.2 12.3 Billiton History
- ↑ Shell Unit Sells Assets To Gencor
- ↑ Gencor pops champagne
- ↑ "BHP Billiton to mop up minority in WMC after taking over 90 pct". Forbes.com (2005-06-17). Retrieved on August 13, 2007.
- ↑ "BHP makes £120bn Rio bid approach", BBC News Online, BBC (2007-11-08). Retrieved on 2007-11-08.
- ↑ "BHP won't be drawn on a Rio sweetener" (in English), FT.com, Financial Times (2007-11-28). Retrieved on 2007-11-28.
- ↑ "BHP makes bid for Rio" (in English). The Age (2008-02-06). Retrieved on 2008-02-06.
- ↑ Keenan, Rebecca (2008-11-25). "BHP Withdraws $66 Billion Stock Offer for Rio Tinto". Retrieved on 2008-11-25.
- ↑ "BHP hits record on talk of Chinese buyer". uk.reuters.com (2008-05-14). Retrieved on 2008-05-14.
- ↑ http://www.telegraph.co.uk/finance/newsbysector/industry/mining/3517199/BHP-Billiton-withdraws-66bn-bid-for-rival-miner-Rio-Tinto.html
- ↑ "SEC Form 20-F, BHP Billiton Limited and BHP Billiton plc, for FY 2007" (PDF), BHP Billiton (2007-09-26), p. 274. Retrieved on 2008-04-09.
- ↑ "BHP chief in shock resignation". CNN.com (2003-01-05). Retrieved on 2007-07-13.
- ↑ "BHP Billiton To Appoint Marius Kloppers As New CEO". BHP Billiton (2007-05-31). Retrieved on 2007-07-13.
- ↑ Macdonald-Smith, Angela (2007-11-18). "BHP Suspends Operations in Angola After Fatal Helicopter Crash" (in English), Bloomberg. Retrieved on 2007-11-18.
- ↑ United Nations Environment Programme Accessed on 16/12/07.
- ↑ Australian Conservation Foundation, “Leaving the scene of the mine”
External links
- BHP Billiton
- London Stock Exchange BHP Billiton PLC (BLT) stock quote
- Australian Securities Exchange BHP Billiton Limited (BHP) stock quote
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