BHP Billiton (ASX:BHP) is the world’s largest diversified resources company, with a global portfolio of high quality assets and more than 100 operations in 25 countries.

It is the biggest listed company on the Australian share market and is widely considered among the blue chip stocks.

It is an industry leader in most of the major commodities markets, including aluminium, coking and thermal coal, copper, manganese, iron ore, uranium, nickel, silver and titanium. On top of this, BHP has sizeable interests in oil, gas, natural gas and diamonds.

Today, BHP reported a 28% on-year increase in 1Q11 iron ore output. The increase was driven by greater system capability of the group’s WA rail infrastructure.

Petroleum production increased 19% in the same period, with BHP’s acquisition of the Fayetteville and Petrohawk shale businesses helping the result.

However copper output declined 24% over the year amid strikes and lower ore grades at the Escondida mine in Chile.

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Resolute Mining (ASX:RSG) is a gold mining and exploration company, operating primarily in Africa and Australia.

It is the second largest gold producer by volume listed on the Australian stock exchange.

The group has a portfolio of three operating mines in Africa and Australia.

Its three operating mines are: Golden Pride in Tanzania, Ravenswood in Queensland, and the newly re-developed Syama in Mali, which was once a BHP Billiton operation.

RSG’s operations are well-placed, and exploration is likely to lead to further resource discoveries, underground, and in nearby pits.

Being unhedged, RSG continues to benefit from a boom in gold prices.

Doubling exploration budget

RSG today announced an annual group exploration budget increase to $20 million in FY12, from $10 million in FY11.

The news comes after RSG identified some high priority exploration targets at Syama in Mali and Ravenswood in Queensland.

RSG has a strengthening balance sheet on the back of operating improvements at Syama.

Results from current exploration at both projects will be provided in the miner’s June Quarter Report.

It is targeting an increase in production from its flagship Syama project to 250,000oz of gold a year after an extended ramp-up and commissioning period

Golden update

Last month, RSG provided its Group gold production and cash cost guidance for FY12.

Gold production in the coming year is forecast to increase to 410,000 ounces at a cash cost of $730 per ounce.

This cements RSG’s position as the second largest primary listed gold producer on the ASX.

It also represents a substantial increase in production and reduction in cash costs.

RSG’s continued improvement in outlook is underpinned by ongoing progress being achieved at the Syama operation in Mali.

The miner’s shares surged 7.6% on the day of the announcement.

Looking ahead

RSG could be debt free by the end of December should existing share options and convertible note debt be converted to equity.

The miner has a highly prospective tenement package with the potential to add significant value for shareholders.

Gold has gained significantly this year, reaching fresh record highs this week as global economic uncertainty pushes investors towards the safety of the shiny metal.

The metal printed highs of around US$1610 this week and continues to hold its ground well above US$1500.

Following the recent production and reserves updates, RSG seems well placed to benefit from the surging gold prices so it will be one of the stocks to watch in coming months.

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BHP Billiton (ASX:BHP) is the world’s largest diversified resources company, with a global portfolio of high quality assets and more than 100 operations in 25 countries.  It is also the biggest company by market cap in the Australian share market, and is considered among the blue chip stocks.

It is an industry leader in most of the major commodities markets, including aluminium, coking and thermal coal, copper, manganese, iron ore, uranium, nickel, silver and titanium. On top of this, BHP has sizeable interests in oil, gas, natural gas and diamonds.

Last week, BHP made a US$15 billion takeover offer for US gas producer, Petrohawk Energy.

The all-cash offer will significantly expand BHP’s oil and gas assets, and in particular, its shale gas holdings in the US,

The deal also signals that BHP is betting the US will turn to unconventional sources of energy, such as shale gas, in an attempt to wean itself of foreign oil.

The offer was unanimously recommended by Petrohawk directors.

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Resolute Mining (RSG) is a gold mining and exploration company, operating primarily in Africa and Australia.

The group’s portfolio focus is on Africa, but the miner also has projects in Australia, Mali and Tanzania.

RSG has three operating mines: Golden Pride in Tanzania, Ravenswood in Queensland, and the newly re-developed Syama in Mali, which was once a BHP Billiton operation.

RSG’s operations are well-placed, and exploration is likely to lead to further resource discoveries, underground, and in nearby pits.

The company continues to benefit from a boom in gold prices.

Golden update

RSG this week provided its Group gold production and cash cost guidance for FY12.

Gold production in the coming year is forecast to increase to 410,000 ounces at a cash cost of $730 per ounce.

This cements RSG’s position as the second largest primary listed gold producer on the ASX.

It also represents a substantial increase in production and reduction in cash costs.

RSG’s continued improvement in outlook is underpinned by ongoing progress being achieved at the Syama operation in Mali.

Resolute mining shares surged 7.6% on the back of the news.

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UGL Limited (ASX:UGL) is an engineering and services company providing industrial maintenance, manufacturing, engineering, transport facilities management and corporate real estate services to blue chip companies and governments across the world.

The company has grown aggressively over the past decade via acquisitions and expansion in the engineering and industrial services sectors.

Owing to its diversification into the rail, infrastructure, resources and services sectors, UGL has continued to win major projects across the board.

Contracts picking up

UGL has agreed to new works and contract extensions worth a combined $400 million.

The company’s contracts include new long term maintenance agreements with heavyweights such as BHP Billiton (ASX:BHP) and Coal Allied (ASX:CNA).

Similar contracts have also been concluded for alumina and fuel refineries.

UGL said it continues to experience positive trading conditions across its resources business.

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Iluka Resources (ILU) is a major participant in the global mineral sands sector and is involved in the production, sales and marketing of titanium mineral products (rutile, ilmenite, leucoxene and synthetic rutile) and zircon.

ILU is the largest producer of zircon in the world, with an approximate market share of 34% and the second largest producer of titanium dioxide minerals with an approximate market share of 18%.

Outside the core mineral sands business, ILU has a royalty interest in specific parts of BHP Billiton’s Mining Area C (MAC) iron ore region in the north west of Western Australia.

Price jump

ILU expects average prices for its titanium dioxide products to rise 75% in the second half of the year and zircon prices by up to 40% for the coming quarter.

The agreements reached with its customers will take effect from 1 July.

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Fortescue Metals Group (FMG) is an iron ore miner, with operations located in the lucrative Pilbara iron ore province in Western Australia.

The company is the third biggest iron ore miner in Australia behind BHP Billiton (ASX:BHP) and Rio Tinto (ASX:RIO) – two of the market’s leading blue chip stocks.

On 1 June, FMG CEO Andrew Forrest announced plans to step down from his role on July 18.

Forrest, who founded FMG in 2003, will assume the new role of company chairman at the board’s next meeting on August 18.

Chief Operating Officer Nev Power will become the new FMG CEO upon Forrest’s exit.

Separately FMG said it is targeting an annual iron-ore production rate of 155 million tonnes by mid-2013.  FMG was previously aiming to achieve the milestone by 2014.

The group said key contracts are in place and the strong price of iron-ore has provided it with the means to grow capital spending.

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NRW Holdings (NWH) provides a diverse range of specialist services to Australia’s mining and resources organisations.

NWH’s business units are split into four divisions: Civil, Mining, Action Mining Services and Action Drill & Blast.

The group’s head office is located in Perth, with branch offices spanning Australia and West Africa.

NWH’s clients are sector bigwigs, including BHP Billiton, Rio Tinto and Fortescue Metals. The group’s lucrative contracts over FY10 offset resource sector shakiness, and FY11 is looking to be a stronger year on increased resource sector activity.

Recently released first half results have already reflected inherent strength with profit jumping over 30%.

Resources return to strength

NWH may not be a famous industry name, but its clients are amongst the resource sector’s most blue chip stocks.

In its civil division, NWH’s RGP5 South project, primarily a rail contract, is in alliance with BHP Billiton Iron Ore.

NRW Holdings is also carrying out port infrastructure and mine site earthworks for CITIC Pacific Mining at Cape Preston, working on the Christmas Creek Rail project for Fortescue metals, and assisting Rio Tinto with Hope Downs, the Western Turner Syncline project, Simandou and Tom Price Mining.

NWH’s long-term alliance with these big names ensures the group is never short of work, even during a resource sector downturn.

With the resource sector returning to boom times on a global economic recovery, NWH stands to pick up more lucrative projects with industry leaders in FY11, making it one of the stocks to watch.

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First half results

Last month, confirmed that it is on track to achieve an FY11 revenue target of at least $700 million.

However, adverse weather has impacted productivity at a number of NWH’s sites.

As a result, NWH expects FY11 net profit to be at the lower end of consensus estimates between $40 million and $45 million.

In addition, NWH has announced a $70 million capital raising.  The issue price of $2.74 is an approximately 4% discount to NWH’s closing price on 13 April.

NWH said it would use the proceeds to moderate its gearing levels following the acquisition of plant and equipment from Comiskey Earthmoving.

For the first half, NWH confirmed 1H11 revenue of $358.3 million, up 30% on a year ago.

Net profit grew 31% to $20.4 million whilst the group declared a half dividend of 4 cents per share, up from 3 cents last year.

NWH said the result was driven by an improved performance in the civil, mining and the drill and blast divisions.

The group’s balance sheet is in a strong position with a cash balance of $40.9 million and net debt of $14.9 million at 31 December 2010.

The company says it is well placed to achieve its minimum revenue target of $700 million, representing 15% growth on FY10.

However NWH’s previous guidance outlined expectations of a 15% – 20% growth in revenue for the full year.

Looking ahead

NWH has a significantly improved cash position in 1H11. Combined with its improved gearing position, NWH has plenty of capacity for future growth.

NWH’s balance sheet is thus in good shape to underpin expansion opportunities and growth.

The value of secured revenue for FY11 is currently $643 million which is 92% of its minimum FY11 target of $700 million.

NWH will be looking to diversify its revenue base as it aims to create a $1+ billion plus order book.

The group has a balance of order book value of $226 million for FY12 and $194 million post-FY12, and is now focused on benefitting on a resource sector recovery with a wide range of civil, mining and oil and gas clients demanding NWH’s services.

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Woodside Petroleum (WPL) is Australia’s largest oil and gas explorer and producer, and one of the world’s leading producers of liquefied natural gas (LNG).

Based in Perth, WPL has major operational assets and exploration and development interests in five continents, but predominantly Australia and the United States

WPL was involved in takeover speculation yesterday after BHP Billiton (ASX:BHP) was rumoured to be preparing a $47 billion takeover offer.

News reports suggested that BHP would purchase Shell’s 34% stake, in WPL in return for giving up some of its assets, such as the Sunrise gas field.

According to the reports, BHP would then make a formal offer for all of WPL’s shares once the stake is acquired.

BHP and Woodside Petroleum denied the rumours and it is unclear whether the deal would receive regulatory approval.  WA premier, Colin Burnett, immediately signalled his opposition to any bid.

WPL has been one of the hot stocks in recent weeks, with its gains coming mostly on the BHP takeover rumours.

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Ausdrill (ASL) is an international mining services group, whose principal activities include providing cutting edge drill and blast, exploration, supply and logistics services to the world’s major mining companies.  They are a diversified company which generates its revenue from a wide range of activities.

ASL has a list of blue chip stocks who are its clients, including BHP Billiton, Rio Tinto and Fortescue Metals.

Over the past few years, ASL has made a well-planned effort to diversify its business and offer more services than the traditional drill, blast and exploration drilling businesses.  These additional services encompass more services to the mining industry.

This diversification is paying dividends, and contributing materially to revenue and growth, while supporting the company’s major goal of becoming a total service provider to the mining industry.

Being heavily dependant on the resources sector, ASL also went through tough times in 2008 on a major correction in the commodities markets.

ASL recently reported first half results with revenue and profits at record levels.  It has been one of the hot stocks recently, surging more than 20% in the past week and a half alone.

Expansion on track

On 17 August 2009, ASL and Brandrill Limited (BDL) announced a proposed merger of the two businesses.

The integration has now been completed and the two businesses are largely complementary with significant synergies.

The move helped Ausdrill gain an immediate presence in Queensland, and the coalfields in the Bowen Basin.

The area is rife with opportunities associated with the recently approved Gorgon Project.

ASL has also significantly increased investment in plant and equipment.

Rising activity in the coal seam gas (CSG) market is likely to see greater demand for ASL’s services.

Africa continues to provide growth for ASL as mining activity ramps up in East Africa and Zambia.

Half results

For the half ending 31 December, ASL reported a 48% jump in underlying earnings to $95.9 million.

Net profit after tax for the period surged 72% to $36.3 million with EPS up 17% to 13.87 cents per share.

Revenue from operations soared 60% to $416 million boosted by the Brandrill integration.

ASL was also awarded new contracts in Africa by Perseus and Adamus.

Following its solid performance, ASL was promoted to the ASX 200 index.

Looking ahead

The company is targeting FY11 net profit after tax of $70 million implying a second half performance similar to the first half.

Unusually wet weather in Australia remains a key risk to operations as well as adverse currency movements.

ASL expects continuing improvement from increased level of activity. Revenue is already at record levels and increasing in all segments.

Margins are also improving after having been impacted by the Brandrill acquisition.

With an interest cover of 6.2 times, Ausdrill has its debt under control.

Despite its fairly high level of capex, ASL’s high level of cash generated should be sufficient to maintain strong profitability.

Commodity prices continue to charge higher which is a key upside driver for ASL as its blue chip clients generate higher earnings.

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