BHP boss says nickel businessunlikely to be profitable until...

BHP boss says nickel businessunlikely to be profitable until 2030 as mining giant considers Nickel West'sfuture

The Business / By business reporters Kate Ainsworth and Kirsten Aiken

• In short: BHP's boss doesn't expect its nickel operations will be profitable before the end of the decade, as it considers mothballing its Nickel West business after the price of the metal plummeted.
• Mike Henry says its iron ore division is well-prepared to manage China's plateauing steel demand and increased competition from other miners in the future.
• What's next? BHP is weighing up the next steps for its Nickel West business and its thousands of employees, but any decision likely to be made in a few months.

BHP believes it's unlikely thatits nickel operations will be profitable before the end of the decade, as themining giant weighs up mothballing its Nickel West business after reporting itsworst half-year profit result since 2016.

The mining company's pessimismfor its nickel business in the short-term follows the release of its half-yearearnings report on Tuesday, with its statutory profit slumping by 86 per centto $1.4 billion — despite its half-year revenue rising by 6 per cent to $41.6billion driven by higher prices for iron ore and copper.

Its dramatic fall in profitfollowed two costly one-offs by the company: increasing its provisions forlegal costs and compensation over the collapse of the Samarco dam in Brazil in2015, and writing down the value of its nickel assets in Western Australia tobe less than worthless.

Nickel was identified as a keyarea of growth for BHP last year, but last week confirmed it was reviewing itsentire nickel operation — including closing Nickel West altogether, putting more than 3,000 jobsat risk.