BHP posts record annual iron production
BHP Billiton Ltd posted record iron ore output for fiscal 2018 as fourth-quarter production topped expectations and set a slightly higher target for the current year.
The global mining company reported that its iron ore output rose to 72 Mt (79 million st) during the three months through June, compared with 70 Mt (77 million st) a year ago.
Shares in the miner jumped more than 3 percent after both quarterly and full-year production rose 3 percent on improved productivity.
Full-year production came in at 275 Mt (303 million st). BHP set a fiscal 2019 production target of 273 Mt to 283 Mt (301 million to 312 million st).
“We have delivered a strong finish to the 2018 financial year with an 8 percent increase in annual production and record output at Western Australia Iron Ore, Queensland Coal and at our Spence copper mine in Chile,” BHP Chief Executive Andrew Mackenzie said in a statement.
BHP also said that it expects to record a charge of $650 million in its fiscal 2018 results following the 2015 Samarco dam failure in Brazil that killed 19 people.
Reuters reported that the charge was at the low end of expectations, analysts said.
“The hit they have taken is at the lesser end of the scale, which could also be the reason why the stock is performing well today,” said Christopher Conway, head of research and trading at Australian Stock Report.
BHP also said that its plan to divest its underperforming US shale oil and gas business is on track, and added that it expects to announce one or more transactions in coming months for a complete exit by the end of 2018.
The race for BHP’s onshore shale assets in the Eagle Ford, Permian, Haynesville and Fayetteville basins, is being led by British oil giant BP Plc which made an offer worth well in excess of $10 billion, people familiar with the matter told Reuters in June.
In a key area the company has targeted for growth, BHP said it had increased its stake to 50 percent in the Samurai prospect in the US Gulf of Mexico, where recent drilling found hydrocarbons “in multiple horizons”, which had not been found in a previous exploration well in the area.