BHP Says Work Underway to Fix Iron Ore Infrastructure Hiccup -- Commodity Comment
April 18 2018 - 9:48PM
Dow Jones News
By Rhiannon Hoyle
SYDNEY--BHP Billiton Ltd., the world's largest listed mining
company by market value, released its third-quarter operational
report on Thursday. BHP trimmed its fiscal-year iron-ore production
estimate because of an infrastructure-linked setback, and also cut
forecast production from its Olympic Dam copper mine. Here are some
remarks from the company's report:
On iron ore production:
"At WAIO [Western Australia Iron Ore], increased production was
supported by record production at Jimblebar and Mining Area C, and
improved rail reliability. This was partially offset by the impact
of lower opening stockpile levels following the Mt Whaleback fire
in June 2017, planned maintenance and port debottlenecking
activities in the first half of the financial year. Volumes
decreased by 6% from the December 2017 quarter reflecting impacts
from Cyclone Joyce and unplanned car dumper maintenance, despite
improved rail reliability and an increase in peak performance in
the number of rakes per day. With the system constraint now at the
port, a program of work is underway to improve car dumper
availability and performance."
On metallurgical coal output:
"At Queensland Coal, production was lower due to challenging
roof conditions at Broadmeadow and geotechnical issues triggered by
wet weather at Blackwater. This was partially offset by record
production at four mines, underpinned by improved stripping and
truck performance, higher wash-plant throughput from
debottlenecking activities and utilisation of latent dragline
capacity at Caval Ridge. Mining operations at Blackwater stabilized
in the current quarter and are expected to return to full capacity
during the June 2018 quarter as inventory levels are rebuilt."
On Olympic Dam:
"Olympic Dam copper production decreased by 18% to 95,000 tons
as a result of the planned major smelter maintenance campaign in
the first half of the financial year. Production guidance for the
2018 financial year has been reduced from 150,000 tons to
approximately 135,000 tons due to a slower than planned ramp-up
during the March 2018 quarter. A return to full capacity is now
expected over the course of the June 2018 quarter."
On petroleum operations:
"Onshore U.S. drilling and development expenditure for the nine
months ended March 2018 was US$648 million. Our operated rig count
declined from nine to seven during the March 2018 quarter. In the
Permian, we continue to see strong results from larger completions.
We expect rig count to remain unchanged through the June 2018
quarter as we focus on meeting 'hold by production' obligations and
progressing sub-surface trials. In the Eagle Ford, early trial
results from wells with longer laterals in the Hawkville have
exceeded expectations and early results in the Austin Chalk horizon
have been positive."
-Write to Rhiannon Hoyle at rhiannon.hoyle@wsj.com
(END) Dow Jones Newswires
April 18, 2018 21:33 ET (01:33 GMT)
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