In my capacity as the lead executive for BHP Billiton managing our proposed acquisition of Potash Corp. of Saskatchewan, I have spent a lot of time in Canada. I wouldn't be the first Scot to have grown fond of Canada, and I have felt first-hand the many parallels between my homeland, and Saskatchewan and Canada.
In the 1970s I was growing up in Scotland, which, like Saskatchewan, is largely dependent on resources. Coal was in decline as oil was discovered in the North Sea. I grew up in a village near coal mines that were being closed. It was the miners' welfare institute that paid for the science prize I won at school and I joined the miners in their protests, but somehow we knew a page had been turned. It was oil that brought us hope.
Oil also brought foreign companies. I heard the same things then in Scotland as I am hearing today in Saskatchewan. "It's Scotland's oil!" Well, of course it was. And it still is. Just as it's Saskatchewan's potash.
Initially there were attempts to restrict the development of oil resources to Scottish, or at least U.K.-based companies. Ultimately, however, almost all of the developments were done by foreign companies. We all benefited. Aberdeen (a city about the size of Saskatoon) flourished and became one of the great capitals of the international oil business. And a lot of taxes got paid. Today, one of the bigger developers of Scottish oil is Talisman Energy, a Calgary company.
Local management of resources is the only way a global company such as BHP Billiton can operate competitively today. A Saskatoon head office has to be empowered. By contrast, the corporate head office must be tiny. Ours is.
Perhaps the greatest evidence of how local management of resources works in BHP Billiton is in Santiago, Chile, where we operate our global copper business. We never forget that the Chilean resources belong to the Chilean people. Most of our senior management team there are Chilean. Even though our copper business is one of the biggest in the world, we act locally and make significant contributions to Chilean communities. If our bid for Potash Corp. succeeds, it will rival our global copper business in scale, and we'll work hard to make Saskatchewan feel as proud of this business as Chile is of our copper businesses.
My company, BHP Billiton, understands the importance of potash to Saskatchewan. That's why in our bid for Potash Corp., we're ready to return control of the business to Saskatoon, protect jobs, invest billions of dollars and increase community spending in the province. We have also made an unprecedented offer to forego tax benefits to which we are entitled under Canadian law - ensuring the province's revenue is not negatively affected by the transaction.
BHP Billiton understands the concerns about broken promises by other foreign companies involved in takeovers in Canada, and we agree that it is important to ensure that promises are not only made, but kept, over the long term. That's why we are willing to submit to scrutiny that goes beyond that which is required by law. Regardless, ours is a global company with a sound track record, and we have spent 150 years building our good reputation. We will retain that reputation by continuing to keep our promises in Canada, as we have done for more than a decade in the Northwest Territories with our Ekati diamond mine.
There are many in Saskatchewan and across Canada who see our bid as an opportunity for Saskatchewan's potash to generate more taxes, create more benefits, and attract more wealth to Saskatchewan. There is no question about who owns the resources. The only question is who operates these resources on behalf of all Saskatchewanians - a privilege we humbly seek.
BHP Billiton has already offered huge net benefit to Saskatchewan. Potash Corp. has belatedly rediscovered its Saskatchewan roots, after we made commitments to the province. Now, the decision facing Investment Canada is simply whether BHP Billiton could bring a further net benefit to Canada as operator of these assets. Then it is for the shareholders to choose between which of two internationally listed, publicly traded companies is the better steward.
BHP Billiton is often referred to as an Australian company. We do have strong roots in Australia, but also in southern Africa and South America. We will put down roots in Canada that are as strong and beneficial as those felt in Australia and elsewhere, and Canada will benefit from our investment just as Scotland benefited from Canadian and other companies investing in the oil industry.
Andrew Mackenzie is chief executive of the non-ferrous unit of BHP Billiton.