BHP Billiton Ltd., the world’s biggest miner, will raise its annual exploration budget by more than a quarter to $900 million as it targets discoveries in copper and conventional petroleum.
The Melbourne-based producer is allocating more capital to hunt for potential discoveries in the two materials, it said Monday in a presentation. That’s even as it cuts overall capital expenditure to $5 billion in the year beginning next month, compared to a peak of $25 billion in fiscal 2013.
BHP in February estimated exploration spending in the current fiscal year would account for $700 million of its forecast $7 billion capital expenditure.
Mining companies, including Anglo American Plc, have trimmed exploration budgets amid wider efforts to lower costs and strengthen balance sheets following a commodities slump that’s eroded profits. Industrywide, annual spending on mineral exploration has slumped to almost $5 billion from a peak of about $20 billion in 2012, Rio Tinto Group said in a presentation Monday.
“We are investing at a time when most in our sector continue to reduce discretionary spend,” Laura Tyler, BHP’s head of geoscience, told a Citigroup Inc. conference Monday in Sydney, according to statement released by the company.
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