BHP Billiton’s Olympic Dam Disruption Unlikely to Affect Market Significantly

Morgan Stanley analysts Rahul Anand and Shannon Sinha believe that the recent disruption at BHP Billiton's Olympic Dam copper operations is unlikely to have a significant impact on either the company or the wider market. In a report, the analysts estimated that while it remains unclear how long the mining and processing operations will be suspended, a potential 15-day shutdown would lead to the loss of approximately 8,000 tons of copper production.

This level of disruption is not expected to have a meaningful effect on BHP Billiton, which projects up to 2 million tons of global copper production for fiscal year 2025. Nor is it anticipated to have a major impact on the global copper market, which is approximately 26 million tons in size. Analysts highlighted that similar disruptions have occurred in the past, such as in 2016, when a blackout led to a 15-day shutdown at one of BHP's copper mines, resulting in roughly $137 million in losses for the company.

Despite the ongoing uncertainty, BHP Billiton shares rose 1.3% to A$42.595.