Rio Tinto lifts force majeure for Australian alumina exports
Rio had declared force majeure on third-party contracts in May after an incident limited its supplies of natural gas.
On Tuesday BHP Billiton (ASX,LON,NYSE:BHP) sold $1 billion worth of bonds in its first offering of debt in the Aussie market in more than a decade. The offering comes after the company announced cutbacks at its iron ore mines.
The world’s biggest miner priced the five-year securities to yield 90 basis points more than the swap rate, reports Bloomberg.
In the last few months, BHP has tackled increasing costs and a significant drop in commodity prices by shelving ambitious expansion plans and letting go employees. The move reminds the industry of BHP’s response to the global economic crisis in 2009, when it hurried to cut jobs and abandoned small operations to protect its credit rating.
In August, the company shelved its $20 billion outer-harbour project at Port Hedland, the one investment it was thought would survive the restructuring of the miner’s $80 billion capex program.
From the start of BHP’s “austerity” program the Olympic Dam uranium-copper-gold project looked the most vulnerable. And so it was, since in late September, the company confirmed it was going back to the drawing board on the $30 billion expansion with 2016 probably the earliest that the Olympic Dam expansion could resurface.
For BHP the main priority is now, as CEO Marius Kloppers and other executives have repeatedly said, maintaining a solid A credit rating.
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