BHP Billiton maintains output and unit cost guidance
Source - SMW
BHP Billiton says all production and unit cost guidance remains unchanged for the 2017 financial year.
But guidance for Olympic Dam is under review following a state-wide power outage in South Australia.
An operation review says good progress continues on the group's capital-efficient latent capacity options with the ramp-up of the Spence Recovery Optimisation project and additional capacity at Jimblebar during the period, and first production from the Los Colorados Extension project anticipated late in the 2017 financial year.
Other key points:
- All four major projects under development are tracking to plan.
- In Petroleum, positive drilling results were reported following the discovery of oil in multiple horizons at the Caicos exploration well in the Gulf of Mexico.
- The group continues to optimise its portfolio of high-quality assets with the announced sale of 50 per cent of its interest in the undeveloped Scarborough area gas fields and completion of the IndoMet Coal and Navajo Coal divestments. It also entered into an agreement with the New South Wales Government to cease progression of the Caroona Coal project.
Chief executive Andrew Mackenzie, said: "Full year production and unit cost guidance remains unchanged. Safety and productivity continue to improve with our new operating model helping us identify and replicate best practice more quickly.
"We have seen early signs of markets rebalancing. Fundamentals suggest both oil and gas markets will improve over the next 12 to 18 months.
"Iron ore and metallurgical coal prices have been stronger than expected, although we continue to expect supply to grow more quickly than demand in the near term. Together, the combination of steadier markets, continued capital discipline, improved productivity and increased volumes in copper, iron ore and metallurgical coal should further support strong free cash flow generation this financial year."