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Australian mining minister warns boom is 'over'

23 august 2012, 18:55
Australia's Resources Minister Martin Ferguson on Thursday declared the mining boom "over" following BHP Billiton's decision to delay the massive Olympic Dam project as commodities prices sag, AFP reports.

"You've got to understand, the resources boom is over. We've done well -- Aus$270 billion (US$283.6 billion) in investment -- the envy of the world," Ferguson told ABC radio.

"It has got tougher in the last six to 12 months. Look at Europe, the state of the European and global economy."

BHP, the world's largest miner, said it would delay and explore a "less capital-intensive design" for the multi-billion dollar Olympic Dam copper and uranium mine as it reported its first profit slump in three years Wednesday.

Cooling in China and ongoing turbulence in Europe saw BHP's annual profit dive 35 percent to US$15.42 billion as prices for a number of its key products including iron ore plunged while its own costs rose.

BHP chief executive Marius Kloppers also blamed the bullish Australian dollar, which has traded near or above parity with the greenback for almost two years for the result, which chimed with recent losses at rival Rio Tinto.

Ferguson earlier said he was not surprised by the Olympic Dam delay and warned that attracting new mining investment was going to be challenging "for some time to come".

The remarks echo recent warnings from Australia's central bank that the once-in-a-century mining boom which helped the resources-rich nation stave off recession during the global downturn was nearing its peak.

The Reserve Bank of Australia expects mining and energy-related spending to peak "sometime in 2013-14", warning in its quarterly outlook on monetary policy this month that the boom would end "somewhat earlier than previously thought".

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