World’s No. 1 mining company BHP Billiton (ASX, NYSE:BHP) (LON:BLT) will raise its annual exploration spending by 29%, allocating nearly all its $900 million budget to finding new copper and oil deposits, which the miner has singled out as the key resources that will bolster its future growth.
The budget increase comes despite the Melbourne-based mining giant’s decision to cut overall capital expenditure to $5 billion in the year beginning next month, compared to a peak of $25 billion in fiscal 2013.
“We are investing at a time when most in our sector continue to reduce discretionary spend,” Laura Tyler, BHP’s head of geoscience, said in a statement.
BHP, already the world’s second-biggest listed copper miner, will be looking for more of the red metal in Chile, Peru, the US, Canada and South Australia, and eyeing new partnerships to boost its growth pipeline.
“We execute our copper exploration both directly and through investment in joint venture opportunities and we continue to seek partnerships with junior explorers,” Tyler said.
In terms of oil, BHP said it has begun drilling sites off the coast of Trinidad and Tobago with another rig set to begin work in the Gulf of Mexico.
The miner believes its substantial oil business, which includes shale deposits in the US, can continue to deliver returns at a crude price of $60 a barrel. Oil is currently trading at around $50, having rallied from 12-year lows at the start of the year.