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Bhp — BHP Billiton — The Lowy Lecture 2009

16 slides from Bhp's conference presentation, Nov 18, 2009

  1. Slide 1: Australia's Resources in the World

    Australia’s Resources in the World Marius Kloppers Chief Executive Officer BHP Billiton The Lowy Lecture 18 November 2009 CONFIDENTIAL AND PROPRIETARY

  2. Slide 2: Disclaimer

    Disclaimer Reliance on Third Party Information The views expressed here contain information that has been derived from publicly available sources that have not been independently verified. No representation or warranty is made as to the accuracy, completeness or reliability of the information. This

  3. Slide 3: The global economy has grown significantly over the past 20 years

    The global economy has grown significantly over the past 20 years Global GDP US$ Trillions, Real at 2005 50 1988–2008 40 +3% GDP ƒ +6% GDP growth growth p.a. per annum 30 20 1980 1990 2000 2009 SOURCE: IMF World Economic Outlook Database 2009. Australia’s Resources in the World Slide 3

  4. Slide 4: Growth has been accompanied by a dramatic increase in living standards in lower income countries

    Growth has been accompanied by a dramatic increase in living standards in lower income countries World Bank Development Indicators Low and middle income nations Child Immunisation1 Electric power Access to adequate water up 93% consumption up 74% supply3 increased 17% from 1985 to 2007 from 1985 to

  5. Slide 5: Growth in the developing world has driven global growth

    Growth in the developing world has driven global growth Global GDP US$ Trillions, Real at 2005 50 6% growth1 per annum in 40 developing world 30 2% growth1 20 per annum in rest of world 10 0 2000 2002 2004 2006 2008 1 Compound annual growth rate. SOURCE: World Bank Development Indicators. Australia’

  6. Slide 6: Australia has abundant natural resources

    Australia has abundant natural resources Australia’s ranking of natural resource reserves by size Bauxite 1 Uranium 1 Nickel 1 Gold 2 Iron Ore 3 Coal 6 Manganese 7 Oil and gas 20 SOURCE: OECD Economic Survey of Australia 2006, table 1.1; BP Statistical Review of World Energy 2009. Australia’s Resour

  7. Slide 7: The natural resources sector is now our largest source of export revenues

    The natural resources sector is now our largest source of export revenues Total export revenues1 Mining2 A$ Billions Manufacturing 118 120 Mining exports now 100 exceed 93 manufacturing by A$25 billion 80 62 60 40 29 20 0 2004 2009 1 Free on-board value 2 Includes oil and gas SOURCE: Australian Bure

  8. Slide 8: However, we may not be completely out of the woods yet…

    However, we may not be completely out of the woods yet… Rise in global credit spreads Aaa less Baa spread, basis points Mild1 Indexed, 100 = Trough Historic Medium2 credit 1937 crisis crunch 600 1930 crisis Current credit crunch3 500 Current 400 300 200 100 Initial level 0 0 10 20 30 40 50 60 70 80

  9. Slide 9: Future demand for our minerals is assured

    Future demand for our minerals is assured Crude steel intensity Kg/capita China/India steel intensity 1,200 Other steel intensity Possible path range for China Taiwan 1,000 South Korea (1970–2006) (1970–2006) 800 600 Japan (1955–2006) 400 US Ch ina China and India (1900–2006) account for 38% of 200

  10. Slide 10: Challenges to future growth

    Challenges to future growth ƒ Growth of Asia’s biggest nations Global ƒ A changing balance of power ƒ Labour flexibility Domestic ƒ Scale Australia’s Resources in the World Slide 10

  11. Slide 11: Labour and talent

    Labour and talent ƒ Talent and labour are critical sector constraints: – Remote areas – Retirement of experienced workers – Aging population – Mix of graduates ƒ Talent gap will return with demand ƒ Must access the increasingly global talent market ƒ Need more training and incentives Iron Ore, Weste

  12. Slide 12: Scale

    Scale ƒ ‘Scale is king’ in the resources sector ƒ Scale is needed to develop assets to their full potential – Skill base – Financial strength ƒ Australia risks losing market share if it does not continue to build scale …and to build this scale requires funding Australia’s Resources in the World Slid

  13. Slide 13: Funding and investment

    Funding and investment ƒ 74 projects worth A$80 billion (in advanced planning stage in Australia) ƒ Limited capital sources to fund projects – Foreign banks more willing to loan – Stunted Australian bond market – Equity markets a short-term solution only ƒ No simple solution, but must involve: – For

  14. Slide 14: Resource reserves are assured for decades

    Resource reserves are assured for decades Known recoverable world resource reserves Years remaining at current demand levels Coal 147 LNG 63 Oil 41 Copper 30 Nickel 41 Iron Ore 95 Bauxite 141 Platinum 318 Reserves will increase with demand due to investment in exploration SOURCE: BP Statistical Revi

  15. Slide 15: Conclusion

    Conclusion ƒ Australia’s resources have a vital place in the world ƒ Helping fuel the world’s growth and development ƒ Contributing significantly to the Australian economy ƒ A great past and looking forward to a great future ƒ But we should not take this for granted ƒ Much rides on us getting this r

  16. Slide 16: bhpbilliton: resourcing the future

    édl bhpbilliton resourcing the future

BHP Billiton — The Lowy Lecture 2009 on 6ix