* BHP’s iron ore margins still good, despite price collapse
* Olympic Dam copper heap leach trial to take 3 more years
* Spin-off company vote to be held in May 2015 (Adds BHP CEO, chairman comments)
MELBOURNE, Nov 20 (Reuters) - BHP Billiton is confident of at least maintaining its dividend even at current weak commodity prices, shrugging off an iron ore price slide triggered by increased output by BHP and other mega producers.
Even with iron ore prices .IO62-CNI=SI trading at a fresh five-year low of $70 a tonne on Thursday, down 48 percent this year, Chief Executive Andrew Mackenzie said iron ore was still a very good business for the world’s biggest miner.
“In some ways it’s still our most profitable business,” Mackenzie told reporters after the company’s annual meeting in Australia.
He and Chairman Jac Nasser said iron ore prices were where BHP had expected them to be when it signed off on expansions three years ago and it could comfortably stick to its strategy of maintaining or increasing its dividend every six months.
“As things currently sit we feel that the dividend at its current level is well covered,” Mackenzie said.
BHP and major Australian iron ore producers, Rio Tinto and Fortescue Metals Group, have together added more than 100 million tonnes of supply to the global market this year, helping to drive prices to their lowest since mid-2009.
While iron ore is the company’s biggest business, it is now focusing its capital spending on copper and petroleum expansions.
It reiterated it would take three more years to test heap leach technology at its massive Olympic Dam copper and uranium mine in South Australia, as it seeks to get more out of its underground mine, rather than building an open pit, a $20 billion-plus plan it scrapped two years ago.
“What we want to do now is first of all get Olympic Dam working at its nameplate capacity, which means using higher grade ore and all other productivity initiatives to actually fill the plant as it was originaly designed,” Mackenzie said.
To expand beyond the plant’s 235,000 tonnes a year capacity, the company aims to use heap leach technology, which extracts ore from rock through chemical reactions.
If the technology worked, it would make the economics of an expansion much more attractive, Mackenzie said.
BHP said it plans to hold a shareholder vote in May 2015 on its plan to spin off its aluminium, manganese and silver assets, along with South African thermal coal and some other assets into a new company.
Mackenzie said the group’s Nickel West business in Western Australia, which the company failed to sell in a separate auction, will remain in BHP. (Reporting by Sonali Paul; Editing by Richard Pullin)