BHP Billiton could be planning to set up a separate $20 billion company comprising its aluminium, bauxite and nickel assets.
The global mining giant has not confirmed or denied media reports that senior executives favour the idea of a new, demerged resources company.
It has been suggested the new resources company would be handed back to shareholders.
BHP responded by repeating that simplification of its portfolio was a priority, and something it had been pursuing for several years.
“We continue to actively study the next phase of simplification, including structural options, but will only pursue options that maximise value for BHP Billiton shareholders,” it said.
Chief executive Andrew Mackenzie and his predecessor Marius Kloppers have been committed to a `four pillars’ strategy – with a focus on iron ore, coal, petroleum and copper.
No expansions, acquisitions or significant capital expenditure related to other commodities has occurred for years, and are not planned for the future.
CMC Markets chief market strategist Michael McCarthy said a demerged BHP entity would add costs, and arguably detract from shareholder value.
He also questioned whether management would really favour that as a capital initiative, saying special dividends or share buybacks that unlocked BHP’s large amount of cash holdings and franking credits were better options.
“My view would be that Mackenzie is making a mistake with this four pillars policy when really the strength of BHP in the last few years with commodities out of favour has been its diversified portfolio,” Mr McCarthy said.
The assets that might be spun off to a separate company are located in Australia, Africa and South America, and employ thousands of workers.
BHP shares gained 58 cents, or 1.6 per cent, to $37.05 on Tuesday.