NEW YORK (TheStreet) -- BHP Billiton (BHP) - Get Report is reportedly about to receive a bid for a big Australian nickel mine, developed and operated so poorly by the company that it had to shut it down earlier this year.
Two mining outfits -- the government-run
China Metallurgical Group
and the Australian nickel miner
-- will submit a joint offer for the mine, known as Ravensthorpe,
The Wall Street Journal
reported Wednesday, citing anonymous sources "familiar with the sale process."
For its part, BHP has said it wants to raise about $460 million by unloading Ravensthorpe. It cost BHP some $2 billion to develop and construct the mine, which the company says can produce up to 50,000 metric tons of nickel a year, but so many technical problems beset the operation that BHP decided to close it down in January as commodities prices collapsed amid the financial crisis and recession.
Other bidders are reportedly in the hunt, as well:
, also of Australia, and
, of Canada.
pointed out, interest in buying the troubled mine sends a strong signal that some industry players believe that demand for metals -- and thus the global economy -- will gain strength enough to justify the costs associated with restarting Ravensthorpe.
Shares in the mining sector were broadly higher Wednesday, with BHP's New York-listed issues gaining 3.6% to $76.98. The American depositary receipts of its Brazilian rival
rose 2.5% to $29.55, while
ADRs were flat at $209.88.
Among U.S.-based mining concerns,
shares were up 1.2% Wednesday;
gained 2.4% to $54.65; and
added 2.3% to $35.64.
-- Written by Scott Eden in New York
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Scott Eden has covered business -- both large and small -- for more than a decade. Prior to joining TheStreet.com, he worked as a features reporter for Dealmaker and Trader Monthly magazines. Before that, he wrote for the Chicago Reader, that city's weekly paper. Early in his career, he was a staff reporter at the Dow Jones News Service. His reporting has appeared in The Wall Street Journal, Men's Journal, the St. Petersburg (Fla.) Times, and the Believer magazine, among other publications. He's also the author of Touchdown Jesus (Simon & Schuster, 2005), a nonfiction book about Notre Dame football fans and the business and politics of big-time college sports. He has degrees from Notre Dame and Washington University in St. Louis.