BHP Announces Production Figures for Second Half of 2018

Miner BHP unveiled its production totals for the second half of 2018, reporting a negative impact of approximately $600 million due to unplanned outages at Olympic Dam, Spence and Western Australia Iron Ore.
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“Production in the first half was broadly in line with the prior period despite planned maintenance and outages,” BHP CEO Andrew Mackenzie said. “In Petroleum, our first appraisal well at Trion in Mexico encountered oil and we added to our exploration options with successful bids for two licences offshore Eastern Canada. We completed the sale of our US shale assets and returned US$5.2 billion to shareholders through a share buy-back program, with a further US$5.2 billion to be returned as a special dividend on 30 January 2019.”
Petroleum production in the second half of 2018, at 63 million barrels of oil equivalent (MMboe) fell 1% year over year, while Q4 2018 petroleum production (30 MMboe) fell 8% over the previous quarter.
Copper production in 2H 2018, at 825 kt, fell 1% year over year, while Q4 2018 production was up 2% over the previous quarter. However, the firm’s FY 2019 guidance increased to between 1,645 and 1,740 kt, reflecting “the retention of Cerro Colorado.” Copper was the only material to receive a guidance adjustment; FY 2019 guidance for petroleum, iron ore, metallurgical coal and energy coal were unchanged.
Meanwhile, the firm’s guidance for its Escondida copper mine in Chile remained unchanged for FY 2019 at between 1,120 and 1,180 kt.
As for iron ore, production in 2H 2018 (119 Mt) rose 2% year over year. However, a train derailment Nov. 5, 2018, impacted Q4 totals, which fell 6% year over year due to a resulting drop in volumes at Western Australia Iron Ore (WAIO).
Metallurgical coal production jumped 2% year over year in 2H 2018, buoyed by “record production” at South Walker Creek, but fell 1% in 4Q 2018 compared with the previous quarter.
Meanwhile, production of energy coal fell 5% year over year in 2H 2018, and held flat in 4Q 2018 compared with the previous quarter.
The firm also offered updates on several projects.
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“During the December 2018 quarter, the North West Shelf Greater Western Flank-B project achieved first production ahead of schedule and under budget. The North West Shelf Greater Western Flank-B project will not be reported in future Operational Reviews,” the company release stated.
“At the end of December 2018, BHP had five major projects under development in petroleum, copper, iron ore and potash, with a combined budget of US$10.6 billion over the life of the projects.”

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