BHP Billiton sets new iron ore production record

BHP Billiton has posted a 14 per cent rise in iron ore production to set a new record.

The company produced a record 233 Mt for the 2015 financial year, and expects this to increase by six per cent in the 2016 financial year to 247 Mt.

BHP said Western Australia Iron Ore (WAIO) production of 254 Mt represents a fifteenth consecutive annual record and was underpinned by continued improvement in the performance of the company’s integrated supply chain and the successful ramp-up of the Jimblebar mining hub.

Record sales volumes out of WAIO of 256 Mt was attributed to optimisation of the port facilities and an increase in direct to ship ore.

BHP has spent millions at WAIO in recent years, turning its attention away from major supply chain investment to productivity, cost reduction and capital efficient growth.

As a result, WAIO production for the 2016 financial year is forecast to increase to approximately 270 Mt as a result of improved processing efficiency at Mining Area C and Newman.

BHP said further productivity improvements are expected to contribute to an increase in system capacity to 290 Mtpa over time.

The company said unit cash costs at WAIO are expected to fall to $US16 per tonne in the 2016 financial year.

In full-year 2015, BHP revealed the average realised price for its iron ore was $US61/wmt,FOB.

In copper, BHP announced up to $US650 million of impairments due to writedowns and  redundancies.

Total copper production for the 2015 financial year was unchanged at 1.7 Mt which the company attributed to a strong operating performance from Escondida.

Copper production is forecast to decrease by 12 per cent in the 2016 financial year to 1.5 Mt.

Olympic Dam copper production for the 2015 financial year decreased by 32 per cent to 125 kt following an electrical failure which caused a mill outage in January 2015.

BHP said the mill safely resumed operation in June 2015, ahead of schedule, and is expected to be fully ramped up by the end of July 2015 with an associated increase in full year production anticipated.

The average realised price for copper for FY15 was $US2.78 per pound.

In metallurgical coal, BHP posted a production increase of 13 per cent to a record 43 Mt.

The company said record production and sales volumes at Queensland Coal in the 2015 financial year were supported by the successful ramp-up of the Caval Ridge mine and continued productivity improvements.

Meanwhile, an increase in equipment and wash-plant utilisation rates underpinned record volumes at six other operations.

Production is forecast to decrease in the 2016 financial year to 40 Mt as a result of the closure of Crinum mine. The mine is expected to close in the first quarter of 2016.

In energy coal, production decreased by 5 per cent to 41Mt.

The average realised price for hard coking coal in FY15 was $US105/t, while BHP received $US58/t for its thermal coal in FY15.

Minerals exploration expenditure in the 2015 financial year was US$267 million.

BHP said greenfield minerals exploration is focused on advancing copper targets within Chile, Peru and the South-West United States.

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