BHP keeps production guidance despite falling prices and bad weather
World’s number one miner BHP Billiton (ASX, NYSE:BHP), (LON:BLT) stuck to its full-year production guidance for its major businesses in the March report released Wednesday, with top earner iron ore logging a 6% growth in output to 40.2 million tonnes, despite the effects of bad weather and falling commodity prices.
The company, which is the globe’s No. 3 iron ore miner behind Brazil’s Vale and Rio Tinto, said production rates were nearing 200 million tonnes a year. It also announced it is maintaining its guidance for fiscal 2013 output of 183 million tonnes for its Pilbara iron ore mines, despite some seasonal cyclone-related shut downs over the first three months of the year.
Floods affecting the firm’s Australian coal mines took their toll on BHP’s coking coal and thermal coal production. The company reported its lowest thermal coal output in five quarters, but said flood mitigation measures have allowed it to bounce back quickly.
BHP’s focus on US onshore oil drilling has began to pay off with a 15% rise in liquids production in the latest quarter, as the miner drills new wells in its vast shale holdings in Texas.
Faced with a fall in US natural gas prices, the miner said it would spend 80% of its $4 billion onshore development budget on the Eagle Ford and Permian shale assets, its biggest liquids-producing holdings.
The global mining giant also reported a 9% increase in copper output for the quarter, driven by an improvement in ore grades at its Escondida mine in Chile and a 42% rise in Olympic Dam output after the completion of planned maintenance.
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