BHP Billiton (BHP)

BHP Billiton said it will cut jobs and slow nickel mining at its Western Australia operations to tackle depressed prices for the metal and the earnings drag from a strong Australian dollar. The company remains committed to nickel and will continue to produce it at its Nickel West operation but is striving for a leaner, more competitive business. About 155 workers and contractors may be affected, although BHP will seek to place people at its iron ore and other businesses, company spokeswoman Kelly Quirke said. The cuts will primarily be in Perth, she added. The nickel unit will temporarily reduce mining at its Mt. Keith operation in the Northern Goldfields region, Quirke said, adding that a recent redesign enabling talc-bearing ore processing will allow Nickel West to maintain production of concentrate from stockpiled ore in the shorter term. BHP shed 57 cents (1.52%) to $36.91.

Santos (STO)

Santos said it has produced first gas from its US$100m Wortel project located in Indonesian waters. In its most recent guidance delivered 19 January, the company said it expected first gas from the project by the end of January. Gross gas production is expected at 90 terajoules per day. Gas will be exported via an existing pipeline to an onshore processing plant and sold for domestic Indonesian power generation. "The successful on-budget delivery of Wortel is another milestone in our focused growth strategy in Asia," Santos Chief Executive David Knox said in a statement. STO fell 14 cents (1.04%) to $13.32.

Mineral Resources (MIN)

Mineral Resources said it has requested 5m metric tonnes of capacity at Esperance as the Western Australia government looks to expand the iron ore port to cater for new mining projects in the southern Yilgarn region. "We've been in discussions with the Esperance Port Authority, and we have certainly expressed a strong interest in being granted an allocation through Esperance for us to export iron ore," said Peter Wade, executive chairman of Mineral Resources. "We're seeking 5m tonnes on the recognition that the development down at Esperance would be a common user facility," Wade said. Earlier this month Western Australia Transport Minister Troy Buswell committed to an expansion of Esperance that would nearly double its capacity to 20m tonnes a year initially. MIN fell 15 cents (1.23%) to $12.00.

Energy Resource of Australia (ERA)

Energy Resource of Australia booked a steep annual loss after the uranium miner was ravaged by heavy rains and poor quality ore at its Ranger pit in the Northern Territory. The company posted a net loss for the year to 31 December of $153.6m, compared to a $47.0m profit in 2010. ERA forecast uranium oxide output in 2012 of between 3,000 and 3,700 metric tonnes compared to 2,641 last year. The miner, however, stressed the number will be highly influenced by rainfall levels over the rest of the wet season. Last year ERA had to buy uranium from other sources to meet sales obligations, but it said in 2012 sales are expected to be broadly in line with production. ERA lost 21 cents (13.64%) to $1.33.

Economic News

4Q House Price Index -1.0% Vs 3Q

The weighted average price of established houses in capital cities fell 1.0% in the fourth quarter from the third, the Australian Bureau of Statistics said. The bureau's house price index also showed the weighted average price of established houses in Australia's eight capital cities was down 4.8% from the year earlier quarter of 2010. The house price index for Sydney fell 1.0% in the fourth quarter and fell 2.7% year-on-year. Hobart city had the largest quarterly increase of 0.8%.

December New Home Sales Down 4.9%

New home sales fell 4.9% in December, according to the Housing Industry Association, drawing on a survey of the country's 100 biggest builders. Uncertainty over lenders passing on any official rate cut, Europe's continuing woes and some signs of softness in the local jobs market all acted as a brake on new homes demand. "Short term monetary and fiscal policy stimulus together with a revitalised program of longer term structural reform is required in early 2012," said Harley Dale, chief economist at the Housing Industry Association.

The NZSX50 rose 5.59 points (0.17%) to 3,301.79 while the Nikkei firmed 4.29 points (0.05%) to be last quoted at 8,806.80 and the Hang Seng added 622.16 points (3.26%) to be last quoted at 19,688.70.

The Australian dollar was last quoted at 106.11 US cents.

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