'Tis the season to hand out some awards

If he played baseball BHP Billiton boss Marius Kloppers would now be heading for the dugout under the three strikes you’re out rule.
'Tis the season to hand out some awards 'Tis the season to hand out some awards 'Tis the season to hand out some awards 'Tis the season to hand out some awards 'Tis the season to hand out some awards


Tim Treadgold

Published in the December 2010 Australia’s Mining Monthly

Instead, he is this year’s winner of Dryblower’s “three strikes medallion” for acts of extreme survival.

Kloppers was the man left to carry the can for his company’s ill-fated attempts to take over Rio Tinto, or merge BHP Billiton’s iron ore division with Rio Tinto, or acquire Canada’s Potash Corporation.

All three deals ended in failure. This left BHP shareholders with an $850 million bill for the services of lawyers, lobbyists, accountants, investment banks, and international airlines.

Kloppers has effectively said he would do it all again because he believes the mega-expansion strategy is a good one.

Dryblower and about 500,000 BHP Billiton shareholders have their doubts about more multi-billion dollar adventures, and havebeen saying so for the past two years for a variety of reasons. Not least of these being that Kloppers has never understood the politics of Europe, which killed his Rio moves, or the politics of Canada, which killed his Potash proposal.

In winning the “three-strikes medallion” Kloppers can at least take away something that recognises his contribution to the mining industry in 2010, albeit for reasons he hopes we will forget.

He is not alone, nor did he make the biggest “contribution” to the wider Australian mining community over the past 12 months. That title goes to someone whose name cannot be mentioned in polite mining circles, so Dryblower will only whisper it: “Ken Henry”

Ken, for anyone who has been asleep since May, was the architect of the Resources Super-Profits Tax. This was the tax that galvanised a nation, claimed the scalp of a prime minister and ignited a debate that is likely to rage for decades.

Ken’s tax is based on a ridiculous assumption of a perpetual resources boom and ever-higher commodity prices, a belief that appeals to populist politicians and voters in Australian states that refuse to encourage mining.

In Ken’s world mining has become the magic pudding. A source of eternal goodies extracted from the ground and funnelled into the electorates of outer Sydney and Melbourne in the form of social welfare handouts, and in the hope of winning votes at future elections.

Fortunately, the mining industry was able to mount a counter-attack on the RSPT. Unfortunately, it was only partially successful, leaving behind a replacement tax on iron ore and coal that will forever be seen as a system easily extended to other minerals.

To Ken goes Dryblower’s “zombie trophy” for creating a tax that died, rose again, striking fear into the mining industry as only the living dead can.

Tax also produced two more award winners for 2010: Andrew Forrest, for leading the charge against the RSPT, and his flatbed truck companion Gina Rinehart, for sharing the megaphone to chant “down with the tax” and other slogans.

To Andrew goes the “iron cup” for leading the tax protest movement in the face of stiff government opposition, knowing he was presenting himself as a larger-than-life target.

This position already has led to him having legal problems over a failed Chinese fund- raising deal.

It would be dreadfully incorrect for Dryblower to draw a link between the tax protests and the continued pursuit of Andrew by the Australian Securities and Investments Commission. It is merely interesting to note that while he attacks one arm of government, another arm is hitting back.

To Gina goes the “memorial plate” for courageously howling down the tax from the back of a truck, and for then going one step further by investing in a television station, presumably with the aim of howling louder – a treat in store for 2011.

A more controversial award, as the northern winter grips Europe and North America, is the “snowman cup” – shared by two Australian politicians, Penny Wong and Peter Garrett. This pair of true believers in climate change will hold their positions until hell freezes over.

Last year, in an early demonstration of the weather doing exactly what it feels like, Penny led a delegation to the Copenhagen climate change conference to discuss global warming. On arrival she found the Danish city in an early freeze, paralysed by snowstorms and unusually cold weather. Oops!

Peter wins his share of the cup for overseeing another global warming event, a home insulation program that had some serious costs – with the big financial cost being the smaller. Ow!

The final, and highest Dryblower award, for 2010 goes to man who has restored gold to its rightful place as a currency of last resort, the head of the US Central Bank, Ben Bernanke.

Ben’s wins the “dollar dazzler Oscar” for his absolute belief in solving the world’s financial woes by dramatically accelerating the production of paper dollars. This has ensured a spectacular outbreak of inflation at some future date, and saves the US from having to pay back all of the money it has borrowed.

Gold miners and gold investors have been the big winners from the paper-printing exercise with the flood of dollars triggering a stampede into the safety of gold, a commodity beyond the reach of governments.

The US will eventually be the winner. The extra dollars represent the world’s biggest ever sovereign debt default because Ben can repay money borrowed over the past 10 years with depreciated dollars (k’ching No.1) while the lower dollar aids US exporters (k’ching No.2).

Dryblower is also a regular contributor to fellow Aspermont publication MiningNews.net.