COMMERCIAL B.H.P.'s Problem In Reporting Finds

Press, Volume CVIII, Issue 31659, 20 April 1968, Page 16

COMMERCIAL B.H.P.'s Problem In Reporting Finds

(N.Z. Press Association—Copyright) SYDNEY, April 19. For the second time in about two years the Broken Hill Proprietary Company, Ltd, has graphically illustrated the problems of reporting developments associated with joint ventures, says the “Australian Financial Review.”

On Tuesday those working at B.H.P. headquarters in Melbourne said they had no knowledge of any international nickel strike. The report on the strike reached the exchange at 1.54 p.m. on Wednesday.

In its two most important joint ventures—oil-gas and nickel—an overseas company has had control of at least part of the joint exploration activities with B.H.P. In the case of oil in the early days, Esso had charge of the dissemination of information and delayed releases until the significance of strikes was fully proved. As a result while B.H.P. was silent, significant and accurate announcements of the

extent of all oil and gas strikes were made by either the Premier, Sir Henry Bolte, or the Mayor of Sale.

This had dramatic effects on the share price and those who sold lost heavily. The former situation has since been rectified and B.H.P. has now very close to immediate information on the oil front and Esso appears much more aware of B.H.P.’s stock exchange obligations than it was in the early days.

As a result, although some leaks occur for a variety of reasons they do not arise because the United States company has withheld information. Now. with nickel, B.H.P. finds itself in the position of being a silent partner relying on the information passed on, says the Review. However, in fairness, there are important differences between the oil-gas situation and the latest nickel position. Under the oil agreement with Esso, the United States company was exploring on B.H.P. areas. In Western Australia, both International Nickel and B.H.P. have areas, with sharing of costs and profits. The latest discovery is on an International Nickel area.