BHP Billiton Iron-Ore Output Down On-Quarter; Cuts Copper Target

BHP-Billiton

BHP Billiton said quarterly iron-ore production was higher on a year ago but down on the period immediately prior because of maintenance work that disrupted its mining operations in remote northwest Australia.

The miner also reported an on-year rise in copper output, but said production was weaker on the quarter earlier because of plant outages. It cut fiscal-year guidance by roughly 3%.

BHP, the world’s biggest mining company by market value, on Wednesday reported iron ore production of 61 million metric tons for the three months through September. That was up 10% on a year earlier, although down 3% on the quarter prior.

The company attributed the on-quarter decline to maintenance aimed particularly at improving the reliability of machinery at its ports. The miner had churned out iron ore, the main ingredient in steel, at record rates during the prior quarter and kept its fiscal-year production target unchanged.

On Tuesday, Rio Tinto also reported a fall in quarterly iron ore production because of maintenance work and a worker death.

BHP, which runs the world’s third-biggest iron ore business by export volume, has broadly been lifting sales from Australia’s remote Pilbara region aided by a productivity drive that’s included increasing equipment utilization and automating trucks and drills. The miner has also been working to remove bottlenecks in its rail and port network and increase capacity at its Jimblebar mine.

“We delivered a 2% increase in copper-equivalent production despite maintenance at a number of our operations” and “we are on track to meet guidance for the 2019 financial year across our commodities, except copper,” said Chief Executive Andrew Mackenzie.

BHP reduced its copper goal following outages at its Olympic Dam mine in Australia and Spence operation in Chile.

Quarterly output of copper fell 12% on the three months prior, although was up 1% on-year.

The company’s petroleum production dropped by 1% on-quarter, reflecting natural field decline, it said.

BHP also reported a 2% fall in steelmaking coal output, and 1% fall in production of thermal coal, used to generate electricity.

[morningstar.com]

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