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Hi Papertigger and all. Great night copper well up as with the dow and most other metals. fingers crossed pna will have a good day :-)

Yes been reading now a few pieces that a divvy might be on the cards. To be totally honest I can take it or leave it. meaning one can build up a good argument for the pro's and the cons as far as growth companies paying divvies. I and a few amigos have pondered it a little and feel PNA needs to be very conservative with their cash. We have all experienced a severe downturn in commodity prices and what that does to cash flow and the ability of a company to grow. I am a fan of buy backs if the cow is getting nice and fat, I know there would be different opinions but maybe one could think that a small divi instead of a buyback in this case. The vol of the buyback would be too small to make a difference. The divi would say �we have confidence in the growth�. You do feel it should though, be small, so that the cash reserves are not impacted too much.

Summary I would sit on the side a small divvy would send a very very positive sign to the market - You would have to think/feel the growth is already mapped out pretty well in terms of projects.

I know from time to time I have talked quite a bit about bhp (mostly on the ozl broad. here is a story on BHP and returning cash. Resource companies, though, do not like to do it. At the risk off boring you all now. I think this a good worth while read. cheers.

Milking the BHP cash cow
Stephen Bartholomeusz Published 1:01 PM, 1 Feb 2011

In the lead up to the imminent release of their results, BHP Billiton and Rio Tinto are being subjected, again, to a campaign by their UK institutional shareholders to return some of the massive cash flows they are generating to shareholders rather than deploy it in acquisitions. Their calls are unlikely to be completely ignored.

The issue of what to do with the cash torrent delivered by the resources boom is a more pressing one for BHP Billiton than for Rio Tinto. For a start, it simply has more cash and less debt, although Rio Tinto's cash flows are burgeoning and its debt decreasing rapidly.

But Rio Tinto, with its recently announced deal to fund Ivanhoe Mines commitment to the Oyu Tolgoi copper-gold project in Mongolia, which could cost it $US3.7 billion, its bid for Riversdale Mining, which will cost $3.9 billion and commit Rio to funding a massive development of the Mozambique coal deposit, the possible development of the Simandou iron ore project in Guinea and the continuing fast-tracking of the expansion of its Pilbara iron ore interests, among other investments, has quite a lot on its plate.

Given its post-Alcan brush with debt-inspired disaster, Rio Tinto is likely to be highly conservative in its balance sheet management for some time to come.

BHP Billiton thought it had outlets for its embarrassment of riches, initially through the aborted Pilbara production joint with Rio and then via its $US39 billion bid for Canada�s Potash Corp. Regulators blocked the joint venture and politicians the bid for Potash Corp.

For a group with minimal net debt which is likely to generate a profit of $US20 billion-plus this year and which, despite spending about $US15 billion on brownfields expansions, is likely to have swelling free cash flows, it will be more difficult for BHP to resist the pressure to return capital to shareholders.

The cash is flowing into the group faster than it can deploy it, despite a massive pipeline of prospective projects.

The constraints for BHP relate not to its capacity to fund organic expansion or projects to invest in, but rather the depth of the reservoir of existing management within the organisation. It has accelerated the timelines for its proposed Jansen greenfields potash project in Canada and could bring more urgency to bear on the expansion of Olympic Dam, but its existing capabilities are being stretched.

After the failure of the Potash Corp bid BHP Billiton reactivated the last $US4.2 billion tranche of its original $US13 billion buy-back program but if it doesn't make another big takeover it will soon again be confronted with the prospect of holding net cash.

High commodity prices, record production volumes and the success of its campaign to move its major commodities to market-related pricing (which means it is capturing the price spikes) may not necessarily be permanent - the prices are highly sensitive to China's levels of economic activity and there is also a delayed supply-side response occurring in the post-crisis environment- but in the near term BHP Billiton is experiencing a deluge of cash.