PM Julia Gillard has declared the peak of the investment phase of Australia's resources boom is still around the corner despite Woodside Petroleum Limited’s
(ASX:WPL) decision to dump the $45 billion Browse LNG processing plant at James Price Point in Western Australia after determining the returns would not justify the investment.
"We haven't seen the peak of the investment phase into resources yet and we are yet to see the peak of the production phase,'' according to Gillard, who insists Australia will sell resources and derive income from investment decisions happening now for several decades to come.
Despite the Prime Minister’s optimism, evidence suggests the investment lineup of the resource industry has lost a lot of gloss in recent times, with Woodside’s decision joining BHP Billiton Limited’s
(ASX:BHP) shelving of its $US30 billion Olympic Dam expansion, while Shell and PetroChina's proposed $US20 billion-plus Arrow LNG project in Queensland is also under a cloud.
Economic news China’s exports and imports rose in March. According to China’s General Administration of Customs, China’s exports gained 10 per cent while imports gained by 14.1 per cent, giving the Chinese economy a trade deficit of $884 million.
Chinese growth slowed in the first quarter of 2013, with the economy growing by 7.7 per cent and again fuelling concerns about the strength of its recovery and possible fiscal stimulus measures. Analysts had expected the worlds second largest economy to accelerate slightly to 8 per cent after tipping 7.9 per cent in the previous quarter.
Commentary RBA Assistant Governor Guy Debelle says the majority of the $284 billion spent on mining expansion in the past decade has been funded by company earnings, rather than by borrowing.
“...the investment boom has been financed almost entirely from the balance sheets of the companies doing the investing. That is, it has been cash-financed from earnings...Because a large share of the resource sector is foreign owned, this internal funding has been reflected in large capital inflows into Australia in the form of foreign direct investment. This has had an impact on both the capital and current account sides of Australia's balance of payments..."
Mr Debelle was speaking to the Melbourne Institute Public Economic Forum, and went on to outline a resultant tripling of foreign capital into the resources sector, roughly 3.5 per cent of Australia’s $1.5 trillion economic output.
Woodside closes one door, opens another Woodside Petroleum Limited
(ASX:WPL) opted not to proceed with a $45 billion liquefied natural gas project at James Price Point in Western Australia after determining the concept does not meet the oil and gas giant’s financial investment requirements.
Woodside says it will engage with the Browse joint venture to evaluate other development concepts to commercialise the Browse resources.
Woodside Petroleum Limited
(ASX:WPL) has confirmed it’s submitted a non-binding expression of interest to the British Columbia government to investigate building a liquefied natural gas export facility at Grassy Point on the north west coast of Canada.
Diamonds aren’t forever BHP Billiton Limited
(ASX:BHP)diamond assets have been offloaded to Dominion Diamond Corporation for $US553 million, marking its exit from the diamond industry and is in line with the company’s strategy on focusing on large, long-life, low-cost, expandable, upstream assets.
Rio Tinto Limited
(ASX:RIO) has shut one of the world's largest copper mines in the US after a massive landslide at the Bingham Canyon Mine. The mine represents 17 per cent of the US's total copper output.
Ivanhoe Australia Limited
(ASX:IVA) has confirmed Rio Tinto’s Turquoise Hill Resources is reviewing options for its 57 per cent stake in the gold and copper producer.
Contracts, production, sell-offs and reductions Decmil Group Limited
(ASX:DCG) has scored two contracts worth more than $71 million at Gina Rinehart's $10 billion Roy Hill Iron Ore Project.
Galaxy Resources Limited
(ASX:GXY) has confirmed the viability for a low-cost and long life operation at its Sal de Vida lithium and potash project in Argentina, with the
potential to generate revenue in the region of $204 million.
Senex Energy Limited
(ASX:SXY) expects to deliver record net oil production of 1.2 million barrels for the 2012/13 financial year, having already reached its annual target of one million barrels of oil.
Sheffield Resources Limited
(ASX:SFX) received confirmation from Brockman Mining Limited
(ASX:BCK) that the sale of the South Pilbara Iron tenements is not subject to approval from the Foreign Investment Review Board and is unconditional.
