Company is the worlds largest diversified resources group. It has seven divisions: Petroleum, Aluminium, Base Metals, Carbon Steel materials, Diamonds and speciality products, Energy coal and Stainless steel materials.

            Red = 25 day moving average.           Green = 200 day moving average.

SALES PER ACTIVITY (Data as of 30/06/2006)

Carbon steel:   28%
Oil:                18%
Aluminum:       15%
Basic metals:   15%
Coal:               9%
Stainless steel: 9%
:                    3%
Diamonds,
minerals, etc:   3%

Business (smh.com.au) - September 6, 2006

BHP and Rio Tinto hot to trot with India - The big two have noted how fast this economy is growing - and acted, Jamie Freed reports.


IF INVESTORS were to place bets on the fastest-growing market for BHP Billiton's commodities, it seems likely that nearly all would place China at the top of the list.

After all, for the past few years Australians have heard endless stories about the China-led resources boom which has proven a huge boon to miners.

But as BHP chief executive Chip Goodyear noted after reporting a record-breaking $US10.5 billion profit last month, the Indian market is growing faster than that of China.

"We haven't talked about India in the past, but it is a growing percentage of our sales," he said. "It's growing faster than China, actually, but it's coming off a much lower base.

"Economic growth has been progressing solidly in India and it is continuing to outperform the expectations we see."

BHP sold $US1.24 billion of products into the Indian market last year - primarily coking coal and copper concentrate - which was nearly triple the $US425 million it sold the previous year. That's still only about one-sixth the amount it sells to China, but given that India's population is expected to be higher than China's by about 2030, the subcontinent is proving to be an increasingly important market for BHP.

And for BHP, India is more than just a destination for its products. The company has three offices in India and is exploring there for commodities including diamonds, bauxite and iron ore. There are also reports it might bid in India's latest petroleum block offering.

"We see India as a good opportunity for us," BHP spokeswoman Samantha Evans said.

Rio Tinto has taken a similar view. India has long been a huge market for rough diamonds from the company's Argyle mine in Western Australia. About 250,000 workers in the Mumbai and Gujarat areas are directly employed in cutting or polishing diamonds from Rio's mines.

But Rio isn't content to just ship diamonds to India anymore. Since 2001, the company has spent about $US21 million ($27 million) on diamond exploration in the country, and it is also looking for iron ore.

"We believe the Indian minerals sector has a bright future ahead of it," said Rio chief financial officer Guy Elliott in a speech to the UK-India Business Leaders' Forum in London in June. "With the right business environment and in partnership with experienced global mining companies, India can unlock its wealth and the country could be a major player in the world minerals markets.

"This sets it apart from China, whose intensity of minerals use is in any case very different and whose mineral resources are less abundant."

A PricewaterhouseCoopers report on the world mining industry this year said India had the potential to be an excellent investment destination.

"When compared to other competing emerging mining markets, the expenditure outlay in India seems low compared to its prospects," the report said. "This gap is likely to be met by the private sector, providing exceptional opportunities for those who are bold enough to invest."

But although India might be more prospective from an exploration point of view, there are some steep hurdles to overcome before a company can build a world-class mining operation.

Austrade's senior trade com-missioner for India, Mike Moignard, says it now takes a "long, long time" to receive government approvals and few mining leases had been granted in the last few years. For example, Rio has been working for about a year to gain a prospecting licence to accelerate its evaluation work in diamonds, so far without success.

Following a recent Indian Government review of the nation's mining policy, the timetables could be sped up.

"That review is with the prime minister and we are hopeful the Government will put forward some changes to make the going easier for foreign investment," Moignard says.

"I think that India is awake to the realisation they've got to expand their mining sector, which a few years ago they really weren't."

It's understood BHP and Rio both made submissions to the government committee reviewing the mining legislation, and that the Australian Government provided some informal advice.

But even if it becomes easier to gain exploration and mining licenses, challenges will persist.

Unlike China, India's recent economic boom has been based more on services and technology rather than manufacturing and infrastructure.

The New York Times last week noted that China invests $7 on roads, ports, electricity and other infrastructure for every $1 spent by India. So obtaining the power, water, and supplies needed to build a large-scale mining operation on the subcontinent could prove especially difficult.

"In short, investing in large resource projects in India is not for the faint-hearted," Rio's regional vice president of India, Nik Senapati, said earlier this year.

Austrade's hope is that Australian companies such as BHP and Rio - but also engineering, construction and contracting firms - can provide some of the expertise needed to improve India's infrastructure. The government agency is sponsoring the International Mining & Machinery Exhibition in Kolkata in November and has also arranged a tour of Indian iron ore and coal mining operations for interested Australian business leaders in tandem with the conference.

BHP is exploring the possibility of providing raw materials and infrastructure to a proposed steel plant which would be built by Korea's Posco.

As Moignard notes, India's gross domestic product is expected to grow by about 9 per cent a year for the next several years, and a lot of that will be dependent on steel production.

"The Government has to look very seriously at both its mining policy and infrastructure program to enable that growth do occur without bottlenecks," he says.

India has large reserves of iron ore - it even exports some to China on the spot market - but it lacks high-quality coking coal and is forced to import some of it from Australia.

Rio and BHP are both interested in helping out the burgeoning Indian steel industry, but they would prefer to remain upstream suppliers. Unfortunately, some states are trying to require miners to build downstream operations to provide additional jobs to aid economic growth.

BHP says it is willing to investigate downstream "value additions" where applicable, but Rio's Elliott thinks the requirement - along with a huge amount of bureaucratic red tape - has proven a disincentive for foreign mining investment.

"In my job, a great many investment proposals cross my desk," he said.

"Attracting mining investment is a competitive business. As a result its of administrative processes, India may be missing out on a potential boom.

"This is certainly the risk it runs in the minerals sector."

how low can blt go, why the big drop??

Dow Jones Newswires - Tuesday, September 26, 2006

UBS Lowers Iron Ore Forecast


UBS cuts its iron ore forecasts and reduces earnings for BHP Billiton and Rio Tinto as result. Now expects 5% drop in iron ore prices in 2007, where previously forecasting 10% rise. Lowers Rio earnings forecast for CY07 by 6% and BHP by 3%. Cites growing iron ore production in China as well as slowing materials consumption.

Toya .... this is a first class company, no question about it ...... it's not one i have ever followed, and i am not sure if i would buy "today" purely because sp is now in uncharted waters ...... however, if you believe, as i do, that commodities still have a long way to travel, though there will be inevitable lurches, then BLT is as good if not better place to put your money than most

Hi Cynic - yes, I reckon commodities will lurch but with a general upward tendency. In particular, I believe that developments in the Far East will have a bearing long term - there seems to be so much going on in that part of the world.

Well is this near the point to get in or is it too early, wish I new. Philip Manduca & Hugh........ his surname escapes me, have stated that commodities and BLT in particular is the place to be.
2517

Hi 2517George,

I reckon BLT is fine for the longer term whatever time you join. However, you can also make money on this one by jumping in and out - I am currently out as I wanted to buy shares in some smaller companies recently. What has worked for me was to buy a large-ish number of shares (1,000) and wait for the price to travel upwards by 1; then sell. It had occurred to me to just keep doing that, as the sp yoyos quite a bit, but then I get all excited about other opportunities and get tied up elsewhere!

I agree long term looks exciting, discipline needed for range trading, and regards to other opportunities I suspect many of us are in the same boat, always something greener elsewhere. Good luck all.
2517

Another big market correction, such as the august dip, would take the sp down to the 1400-1500p range. If the banks are all reporting this month on their exposure to sub-prime debt, another dip may be likely, imo.

So what happens if the UK banks report minimal sub prime impact?

"If" being the operative word H.

Countrywide Financial, DeutscheBank, BNP Paribas, Citibank have all reported heavy exposure to sub-prime. It would seem reasonable to assume that the main U.K. banks will not escape unscathed. Lots of 'Ups' & 'downs' to come.
Sorry to have got 'off topic' on this thread. BLT sitting comfortably on the 1700p support level. Lets hope it holds.

BHP Billiton confirms approach made to Rio Tinto, Rio Tinto rejected proposal
AFX


LONDON (Thomson Financial) - BHP Billiton PLC said it approached the board of Rio Tinto about a possible combination of the two companies but that Rio Tinto rejected the proposal.

BHP Billiton said it has again written to Rio Tinto and intends to continue to seek an opportunity to meet and discuss its proposal.

BHP Billiton said it made the announcement following recent speculation in relation to a potential offer for Rio Tinto at a premium.

& the sp went from 1730p to 1850p in nano seconds!

It was quick, makes one think !!

BHP to keep oil, gas business despite Rio bid: analysts
Mon Nov 12, 2007 7:10 AM GMT
Email This Article | Print This Article | RSS [-] Text [+] By Fayen Wong

SYDNEY (Reuters) - BHP Billiton Ltd/Plc (BHP.AX: Quote, Profile , Research) (BLT.L: Quote, Profile , Research) was unlikely to offload its lucrative petroleum division to help fund a $140 billion takeover bid for rival Rio Tinto (RIO.AX: Quote, Profile , Research) (RIO.L: Quote, Profile , Research), analysts said.

BHP is poised to reap major returns from the business, with some of its biggest oil and gas projects due to come onstream in the next two years.

"Selling the assets right now, ahead of completing major developments, means they won't be able to realize the maximum value," said Warren Edney, a resource analyst at ABN AMRO.


Analysts said BHP's strong balance sheet meant it should easily be able to secure the financing needed for such a deal without having to sell the petroleum business to raise funds.

British newspapers reported over the weekend that BHP may look to sell its oil and gas arm for $40 billion to help fund a bid for Rio, which is not in the oil business.

A BHP spokeswoman declined to comment on the report.

BHP has so far proposed an all-scrip bid to Rio, which has rejected the offer, and fund managers have suggested it may need to sweeten the offer with a cash component. Continued...

© Reuters 2007. All Rights Reserved. | Learn more about Reuters

The chart would suggest we are heading down to the 1400 - 1500p range, but with the possible merger rumour I can't make my mind up which way the sp is heading. In the long term this has got to be a good investment (Falkland Isles etc), imo.

Source ABC News:
"BHP Billiton says it is planning to scale back some of its South African aluminium operations because of the country's power emergency.

South Africa's state power company, Eskom, is forcing major firms to reduce their energy use by 10 per cent because it cannot meet demand.

BHP says it has begun talking to its employees about closing part of its Bayside smelter on the country's east coast.

It is also reducing output at another two of its South African smelters and says in total, aluminium production will fall by about one third."

So, production will fall, thus reducing BLT revenue, but the shortage should push up the price of Aluminium, so...........??? Who knows?

SYDNEY, Nov 18 Reuters) - "BHP Billiton Ltd/Plc says it wants to develop one of Australia's largest untapped uranium deposits, after the state government where the deposit is located lifted a ban on mining the nuclear power feedstock.

The 10-kilometre-long (6 miles) Yeelirrie deposit, located about 1,000 km north of Perth in west Australia, is estimated to contain about 52,000 tonnes of uranium.

That's 7 percent more than total world production last year, according to figures from the World Nuclear Association.

Prices have fluctuated widely in recent years, with uranium currently selling for about $48 a pound.

BHP said it had notified the Western Australia government it was initiating a drilling exploration program to confirm the amount of uranium at the long-dormant Yeelirrie deposit, discovered in 1972.

Western Australia on Monday officially ended its ban on uranium mining, paving the way for miners to step up exploration inside its borders.

The state's newly-elected Leader Colin Barnett ran a successful campaign on support for uranium mining, predicting new mines could be dug within five years to meet international demand, in turn generating millions of dollars in royalties for the state.

A BHP spokesman declined to provide a timetable for developing the project."