General Mining:Should You Invest in South32?

To invest in South32,the recent spinoff of Australian general mining titan BHP Billiton,you must have access to the London,South African or Australian stock exchanges.The new firm concentrates on mines and smelters of coal,manganese,aluminium and nickel.Led by CEO Graham Kerr,it has operations in Australia,Africa and Colombia,plus non-operated joint venture interests in Brazil.It is immediately the third largest miner in the world,behind BHP and Rio Tinto.*
South32,which is based in Perth,cites its strong commodity and customer diversification,with assets having 8.3 billion of revenue in 2014.RBC,JP Morgan,Citi and Merrill Lynch have buy ratings on the firm as a strong generator of cash,albeit one with a dearth of production growth.RBC said it has an outperform on the company in light of its high quality portfolio of low cost assets with exposure to a diverse set of commodities which we favour.While production growth is lacking,cost out should support near term earnings;longer term the strong balance sheet supports M&A driven growth.*
Credit Suisse is neutral on the stock.*
BHP Billiton said it wanted to simplify its portfolio by spinning off a cash generator with high quality metals and mining assets competitively positioned in their respective cost curves.The Melbourne-based company pays a hefty 5.70% dividend yield and is listed on the NYSE.It has 41 assets in 13 countries,including petroleum and potash,copper,iron ore,coal,aluminium,manganese and nickel.It also has silver,lead,zinc,molybdenum,uranium and gold assets.BHP mines bauxite,refines it into alumina and smelts alumina into aluminium;mines manganese and produces manganese metals and alloys;and mines and produces nickel products.*
South32 Ltd (LSE:S32),BHP Billiton PLC ADS (BBL)

Western Australia Drawing Increased Interest

Exxon Mobil and BHP Billiton plan to develop a vast natural gas field about 300 kilometers off the coast of Western Australia using a huge gas processing vessel for liquefied natural gas production.The floating plant would produce 6.7 million metric tonnes of LNG a year beginning in 2020-21,the companies said in a filing with Australia's environment department.
The Scarborough field is located in the Carnarvon Basin.The vessel proposed to operate there would employ Floating LNG technology,or FLNG.It is used when gas fields are too small or remote to make onshore facilities practicable.
In a related development,the US State Department has opened a commercial office in its Perth consulate.The office will match an expected surge of US companies looking to invest in Western Australia with local firms which can meet their needs as resource extraction activities ramp up in response to demand from emerging Asia.
Canadian real estate investment trust Brookfield Office Properties lists Perth as a high growth market,ahead of Boston and Vancouver.The REIT owns Brookfield Place in Perth and has a 50% interest in two other office buildings on St Georges Terrace.
Exxon Mobil(XOM),BHP Billiton Ltd(BHP),Brookfield Office Properties(BPO)