UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

October 18, 2017

 

 

 

BHP BILLITON LIMITED

(ABN 49 004 028 077)

(Exact name of Registrant as specified in its charter)

 

VICTORIA, AUSTRALIA

(Jurisdiction of incorporation or organisation)

 

171 COLLINS STREET, MELBOURNE,

VICTORIA 3000 AUSTRALIA

(Address of principal executive offices)

  

BHP BILLITON PLC

(REG. NO. 3196209)

(Exact name of Registrant as specified in its charter)

 

ENGLAND AND WALES

(Jurisdiction of incorporation or organisation)

 

NOVA SOUTH, 160 VICTORIA STREET

LONDON, SW1E 5LB

UNITED KINGDOM

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:   ☒ Form 20-F    ☐ Form 40-F

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):  ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):  ☐

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934:  ☐ Yes    ☒ No

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): n/a

 

 

 


NEWS RELEASE    LOGO

 

Release Time        

   IMMEDIATE

Date

   18 October 2017

Release Number

   32/17

BHP OPERATIONAL REVIEW FOR THE QUARTER ENDED 30 SEPTEMBER 2017

 

  All production and unit cost guidance remains unchanged for the 2018 financial year.

 

  Good progress has been made on our latent capacity projects, with first production from the Los Colorados Extension project and the Olympic Dam Southern Mining Area achieved in the September 2017 quarter and the Caval Ridge Southern Circuit project progressing to plan.

 

  All major projects under development are tracking to plan.

 

  In Onshore US, our operated rig count increased from five to nine during the September 2017 quarter. Divestment of a small portion of the Hawkville acreage was completed during the quarter, with work underway to exit our remaining Onshore US assets for value.

 

  In Petroleum exploration, evaluation of the positive drilling results from Wildling-2 is continuing, with a sidetrack also encountering oil in multiple horizons which will assist with establishing the scale of the discovery.

 

Production

   Sep Q17      vs Sep Q16      

Petroleum (MMboe)

     50        (8 %)    Lower volumes reflect natural field decline and the impact of Hurricane Harvey on US petroleum assets.

Copper (kt)

     404        14   Increased volumes at Escondida supported by the start-up of the Los Colorados Extension project and higher average copper grades and throughput.

Iron ore(1) (Mt)

     56        (3 %)    Improved mine productivity and record volumes at Jimblebar offset by the impact of planned maintenance and lower opening stockpile levels, following the fire at the Mt Whaleback screening plant in June 2017.

Metallurgical coal (Mt)

     11        0   Record production at Saraji mine and increased productivity across Queensland Coal mines offset by lower production at Broadmeadow.

Energy coal (Mt)

     7        (2 %)    Strong performance at New South Wales Energy Coal offset by the impacts of unfavourable weather at Cerrejón.

BHP Chief Executive Officer, Andrew Mackenzie, said: “Our performance in the first quarter keeps us on track to deliver seven per cent volume growth in the 2018 financial year.

We manage the portfolio for value and returns. Our transition to lower-cost, high-return, latent capacity projects is delivering results, with first copper production achieved from the Los Colorados Extension project at Escondida and Olympic Dam’s Southern Mining Area during the quarter.

Major development work has commenced on the recently approved growth projects, Mad Dog Phase 2 and the Spence Growth Option, with both set to become operational as their respective markets in oil and copper rebalance.”

 

 

   1


Summary

Operational performance

Production for the September 2017 quarter and guidance for the 2018 financial year are summarised in the table below.

 

Production

   Sep Q17      Sep Q17
vs

Sep Q16
    Sep Q17
vs

Jun Q17
    FY18
guidance
 

Petroleum (MMboe)

     50        (8 %)      (3 %)      180 - 190  

Onshore US (MMboe)

     17        (16 %)      (12 %)      61 - 67  

Conventional (MMboe)

     33        (3 %)      2     119 - 123  

Copper (kt)

     404        14     4     1,655 - 1,790  

Escondida (kt)

     268        23     19     1,130 - 1,230  

Other copper(i) (kt)

     136        (1 %)      (16 %)      525 - 560  

Iron ore(ii) (Mt)

     56        (3 %)      (8 %)      239 - 243  

WAIO (100% basis) (Mt)

     64        (4 %)      (8 %)      275 - 280 (iii) 

Metallurgical coal (Mt)

     11        0     24     44 - 46  

Energy coal (Mt)

     7        (2 %)      (18 %)      29 - 30  

 

(i) Other copper comprises Pampa Norte, Olympic Dam and Antamina.
(ii) Excludes production from Samarco.
(iii) Subject to regulatory approvals to increase capacity above 270 Mt.

Major development projects

On 17 August 2017, the BHP Board approved an investment of US$2.5 billion for the development of the Spence Growth Option.

At the end of the September 2017 quarter, BHP had four major projects under development in Petroleum, Copper and Potash, with a combined budget of US$7.5 billion over the life of the projects.    

Corporate update

On 20 September 2017, BHP released its Economic Contribution Report which shows the Group’s direct economic contribution globally in the 2017 financial year was US$26.1 billion. This includes US$4.7 billion in taxes, royalties and other payments to governments. BHP’s adjusted effective tax rate in the 2017 financial year was 34.0 per cent. When royalties are included, the rate was 44.0 per cent. In Australia, we anticipate making final corporate income tax cash payments in the first half of the 2018 financial year of approximately US$1.2 billion relating to the prior year. On 22 September 2017, BHP successfully concluded its US$2.9 billion multi-currency bond repurchase plan. The bond repurchase plan has extended BHP’s average debt maturity profile and enhanced the Group’s capital structure. The total cost in relation to the repurchase program was approximately US$100 million, which will be reported in net finance costs in the December 2017 half year. This does not take into account the multi-year interest expense saving from a lower average debt balance following the bond repurchase program.

 

 

BHP Operational Review for the quarter ended 30 September 2017    2


Petroleum

Production    

 

     Sep Q17      Sep Q17
vs
Sep Q16
    Sep Q17
vs
Jun Q17
 

Crude oil, condensate and natural gas liquids (MMboe)

     22        (9 %)      (8 %) 

Natural gas (bcf)

     169        (7 %)      1
  

 

 

    

 

 

   

 

 

 

Total petroleum production (MMboe)

     50        (8 %)      (3 %) 
  

 

 

    

 

 

   

 

 

 

Total petroleum production – Total petroleum production for the September 2017 quarter decreased by eight per cent to 50 MMboe. Guidance for the 2018 financial year remains unchanged at between 180 and 190 MMboe, comprising Conventional volumes between 119 and 123 MMboe and Onshore US volumes between 61 and 67 MMboe.

Crude oil, condensate and natural gas liquids – Crude oil, condensate and natural gas liquids production for the September 2017 quarter declined by nine per cent to 22 MMboe.

Conventional liquids volumes decreased by five per cent to 15 MMboe reflecting natural field decline across the portfolio, the impact of Hurricane Harvey in the Gulf of Mexico and planned maintenance at North West Shelf.

Onshore US liquids volumes decreased by 15 per cent to 7 MMboe as a result of natural field decline and the impact of Hurricane Harvey, which more than offset additional wells put online in the Black Hawk and Permian.

Natural gas – Natural gas production for the September 2017 quarter declined by seven per cent to 169 bcf.

Conventional gas volumes for the September 2017 quarter were broadly unchanged at 107 bcf. Onshore US gas volumes declined by 17 per cent reflecting natural field decline and the impact of Hurricane Harvey, partially offset by additional wells put online in the Black Hawk, Permian and Haynesville.

In the September 2017 quarter, we completed an agreement with Chevron and ExxonMobil to withdraw from our 4.95 per cent interest in the Genesis deepwater asset in the Gulf of Mexico, consistent with our aim to further simplify the portfolio. Financial closing is expected by the end of November 2017, with an effective date of 1 January 2017.    

Projects    

 

Project and ownership

   Capital
expenditure
(US$m)
     Initial
production
target date
    

Capacity

  

Progress

North West Shelf Greater

Western Flank-B

(Australia)

16.67% (non-operator)

     314        CY19      To maintain LNG plant throughput from the North West Shelf operations.    On schedule and budget. The overall project is 57% complete.

Mad Dog Phase 2

(US Gulf of Mexico)

23.9% (non-operator)

     2,154        CY22      New floating production facility with the capacity to produce up to 140,000 gross barrels of crude oil per day.    On schedule and budget. The overall project is 6% complete.

Petroleum capital expenditure of approximately US$2.0 billion is planned in the 2018 financial year. This includes Conventional capital expenditure of US$0.8 billion, which remains focused on high-return infill drilling opportunities in the Gulf of Mexico, a life extension project at North West Shelf and investment in the Mad Dog Phase 2 project. Onshore US capital expenditure is expected to be approximately US$1.2 billion reflecting increased development activity.

Onshore US development activity

Onshore US drilling and development expenditure for the September 2017 quarter was US$131 million. Our operated rig count increased from five to nine during the quarter as two rigs in the Permian, and one in each of the Black Hawk and Haynesville, were added.

 

  In the Permian, we continued to drill to meet ongoing Hold by Production obligations while also progressing sub-surface trials intended to de-risk future development.

 

 

BHP Operational Review for the quarter ended 30 September 2017    3


  In the Black Hawk, we observed better than expected performance in recent trials which improved completion designs, enhanced staggered laterals and demonstrated commerciality of Upper and Lower Eagle Ford co-development.

 

  In the Haynesville, our hedging strategy continues to allow us to reduce price risk and secure average rates of return in excess of 20 per cent.

 

  In the Fayetteville, we continue to work with partners to assess the potential of the Moorefield horizon. We anticipate participation in additional non-operated wells in the 2018 financial year.

 

September 2017 quarter

(September 2016 quarter)

        Liquids focused areas      Gas focused areas  
      Eagle Ford      Permian      Haynesville      Fayetteville      Total  

Capital expenditure(i)

   US$ billion      0.1 (0.0)        0.1 (0.1)        0.0 (0.0)        0.0 (0.0)        0.1 (0.1)  

Rig allocation

   At period end      2 (1)        3 (1)        4 (0)        0 (0)        9 (2)  

Net wells drilled and completed(ii)

   Period total      5 (1)        1 (11)        0 (0)        0 (1)        6 (13)  

Net productive wells

   At period end      936 (928)        127 (116)        393 (395)        1,044 (1,044)        2,500 (2,483)  

 

(i) Includes land acquisition, site preparation, drilling, completions, well site facilities, mid-stream infrastructure and pipelines.
(ii) Can vary between periods based on changes in rig activity and the inventory of wells drilled but not yet completed at period end.

The divestment of a small portion of the Hawkville acreage was completed in the September 2017 quarter. Work is underway to exit the remaining Onshore US assets for value.

Petroleum exploration

Exploration and appraisal wells drilled during the September 2017 quarter are summarised below.

 

Well

   Location    Target    BHP equity   Spud date    Water depth      Total well
depth
     Status

Wildling-2

   US Gulf of Mexico
GC520
   Oil    100%
(Operator)
  15 April 2017      1,267 m        10,205 m      Hydrocarbons encountered,
temporarily abandoned.

Wildling-2 ST01

   US Gulf of Mexico
GC520
   Oil    100%
(Operator)
  11 August 2017      1,267 m        10,177 m      Hydrocarbons encountered,
temporarily abandoned.

The Wildling-2 well was spud on 15 April 2017 and drilling was completed on 11 August 2017. The Wildling-2 well encountered oil in multiple horizons. A sidetrack to the Wildling-2 well commenced on 11 August 2017 to further appraise the discovery and was completed on 26 September 2017. This also encountered oil in multiple horizons and will assist further with establishing the scale of the discovery.

In the US Gulf of Mexico, the Scimitar well spud on 1 October 2017 with results expected in the March 2018 quarter. BHP holds a 65 per cent working interest and is the operator of the Scimitar prospect, with partner Repsol (20 per cent working interest) and Statoil (15 per cent working interest).

In Mexico, an Exploration and Appraisal plan for the Trion contractual area license number CNH-A1-Trion/2016 (formerly referred to as blocks AE-0092 and AE-0093) was submitted to the Comisión Nacional de Hidrocarburos of Mexico by BHP and Pemex on 29 August 2017, in line with regulatory requirements.

In Trinidad and Tobago, we continued appraisal work to assess the potential commercialisation of the gas discovery at LeClerc. Preparations continued for Phase 2 deepwater exploration which is expected to commence in the second half of the 2018 financial year.

Petroleum exploration expenditure for the September 2017 quarter was US$207 million, of which US$78 million was expensed. A US$715 million exploration program is planned for the 2018 financial year. This program includes the Scimitar exploration well in the US Gulf of Mexico and three wells in Trinidad and Tobago.

 

 

BHP Operational Review for the quarter ended 30 September 2017    4


Copper

Production

 

     Sep Q17      Sep Q17
vs

Sep Q16
    Sep Q17
vs

Jun Q17
 

Copper (kt)

     404        14     4

Zinc (t)

     29,201        90     0

Uranium oxide concentrate (t)

     880        (4 %)      19

Copper – Total copper production for the September 2017 quarter increased by 14 per cent to 404 kt. Guidance for the 2018 financial year remains unchanged at between 1,655 and 1,790 kt.

Escondida copper production for the September 2017 quarter increased by 23 per cent to 268 kt, supported by the start-up of the Los Colorados Extension (LCE) project on 10 September 2017 and higher average copper grade and throughput. LCE is expected to ramp-up to full capacity during the December 2017 quarter, enabling utilisation of the three concentrators, and support copper production of between 1,130 and 1,230 kt in the 2018 financial year. Escondida and Union N°2 of Supervisors and Staff signed a new Collective Agreement, valid from 1 October 2017, which will have a duration of 36 months. The existing agreement with Union N°1 will expire on 1 August 2018.

Pampa Norte copper production for the September 2017 quarter decreased by seven per cent to 58 kt, despite record material mined at Cerro Colorado and record ore milled at Spence. The decrease was mainly due to unplanned maintenance at Spence’s tank house during the quarter. Pampa Norte copper production for the 2018 financial year is expected to be higher than the prior year.

Olympic Dam copper production increased by three per cent to 42 kt with first ore achieved from the high-grade Southern Mining Area in the September 2017 quarter. Copper production of 150 kt is expected in the 2018 financial year as a major smelter maintenance campaign is undertaken. The maintenance campaign commenced on 21 August 2017 and will be phased through to the December 2017 quarter. On completion, improved operating performance, coupled with higher ore grades from the Southern Mining Area, will underpin an expected increase in production to approximately 215 kt in the 2019 financial year.

Antamina copper production for the September 2017 quarter increased by five per cent to 36 kt due to higher head grades. Copper production of approximately 125 kt is expected in the 2018 financial year as mining continues through a zinc-rich ore zone consistent with the mine plan. Zinc production of approximately 100 kt is expected for the 2018 financial year.

Projects    

 

Project and

ownership

   Capital
expenditure
(US$m)
     Initial
production
target date
    

Capacity

  

Progress

Spence Growth Option

(Chile)

100%

     2,460        FY21      New 95 ktpd concentrator is expected to increase Spence’s payable copper in concentrate production by approximately 185 ktpa in the first 10 years of operation and extend the mining operations by more than 50 years.    Project approved on 17 August 2017.

 

 

BHP Operational Review for the quarter ended 30 September 2017    5


Copper reserves

Hypogene Sulphide Ore Reserves at Spence

BHP confirms the inclusion of significant additional Hypogene Sulphide Ore Reserves to the Spence declaration, and minor increases to the oxide and supergene sulphide reserves previously declared as at 30 June 2017.

The declaration of Hypogene Sulphide Ore Reserves (including minor contributions of transitional sulphide material) reflects the approval of capital expenditure (US$2.46 billion) by BHP on 17 August 2017 for the construction of a concentrator and associated infrastructure at Spence. The Spence pit expansion to exploit the deeper hypogene material has resulted in a minor increase in Ore Reserves for the oxide and supergene sulphide ore types declared as at 30 June 2017. The Spence Growth Option (SGO) project has been assessed as technically achievable and economically viable.

The Spence Hypogene Sulphide Mineral Resources and Ore Reserves are a downward, continuous extension of the currently exploited Supergene Oxide and Sulphide Mineral Resources and Ore Reserves. The supergene oxide and sulphide material is currently processed in a leaching operation whereas the hypogene sulphide material will provide ore feed to a conventional sulphide milling and flotation concentrator plant.

The Spence deposit is centred on porphyry bodies that have intruded sedimentary and volcanic units. Vertically extensive hypogene chalcopyrite with or without molybdenite mineralisation is overprinted by supergene sulphide chalcocite with or without covellite mineralisation. The supergene sulphides are locally oxidised to a copper oxide assemblage. The contact between the supergene and underlying hypogene sulphide zones is transitional.

Reserves are estimated incorporating operational parameters, geotechnical constraints, costs and commodity prices as defined by BHP. Optimal pushback designs are developed by incorporating mine operational aspects, plant capacity, loading equipment and ore exposure to produce a mining production plan. The selection and design options take into account both processing route alternatives and are based on the optimal economic sequence according to operational restrictions. The current and future SGO project fleet size is estimated based on the optimal production levels to maximise the net present value given the existing infrastructure and geotechnical parameters.

Ore Reserves classification reflects the Mineral Resources classification, along with consideration of any uncertainties in relation to modifying factors. Key modifying factors, incorporating Spence’s processing alternatives and unit capacities are copper content, mineral hardness, comminution and processing rates, and metallurgical recovery by plant. Approximate drill hole spacing, which is indicative of reserve classification, is presented in the table below.

Nominal drill grid spacing for Ore Reserves classification

 

Classification

  

Oxide

  

Supergene Sulphide

  

Transitional and Hypogene
Sulphides

Proved (maximum)

   50m x 50m    70m x 70m    70m x 70m

Probable (maximum)

   100m x 100m    100m x 100m    100m x 100m

The main economic driver for the planned process routes of supergene (leach) versus hypogene (concentrator) is based upon copper mineralisation species, refined by copper cut-off grade. The cut-off grades used to differentiate waste from mineralisation are 0.20 per cent total copper for the supergene, transitional and hypogene sulphide material for concentrator processing and 0.30 per cent total copper for the supergene sulphide and oxide material for heap leaching. These cut-off grades are based on break-even economic analysis and assume open-pit extraction (15m bench height).

Copper in supergene oxide and sulphide mineralisation is currently recovered through heap and dump leaching and a solvent extraction and electrowinning plant. The construction of the SGO project facilities will add a new processing route, sulphide flotation and concentration of the hypogene copper sulphides (chalcopyrite) which are refractory to heap leaching technology. These facilities include: a primary crusher, a semi-autogenous grinding mill, two ball mills, a sulphide froth flotation plant and tailings storage facilities, combined with concentrate export and sea-water desalination and process water delivery facilities. The concentrator plant will generate molybdenum as a separate concentrate product stream, along with gold and silver credits in the copper concentrate.

 

 

BHP Operational Review for the quarter ended 30 September 2017    6


Concentrator metallurgical recoveries of between 82 and 91 per cent of total copper have been informed on the basis of extensive laboratory and pilot testwork. Studies indicate that arsenic content within the deposit can be managed to minimise product contamination risk. The revised Ore Reserves estimate for Spence as at 17 August 2017 is presented in the table below.

Spence updated Ore Reserves(1) as at 17 August 2017 in 100 per cent terms – reported in compliance with the ASX Listing Rules 2014

 

            As at 17 August 2017      As at 30 June 2017  

Ore Type

(2) (3) (4) (5) (6)

   Cut-
off
TCu
%
     Proved Ore Reserves      Probable Ore Reserves      Total Ore Reserves      Total Ore Reserves  
      Mt

 

     TCu
%
     SCu
%
     Mo
ppm
     Mt

 

     TCu
%
     SCu
%
     Mo
ppm
     Mt

 

     TCu
%
     SCu
%
     Mo
ppm
     Mt

 

     TCu
%
     SCu
%
     Mo
ppm
 

Oxide

     0.30        37        0.64        0.43        —          1.4        0.84        0.66        —          38        0.64        0.43        —          35        0.65        0.45        —    

Oxide Low

Solubility

     0.30        14        0.90        0.40        —          8.6        0.63        0.26        —          23        0.80        0.34        —          25        0.77        0.33        —    

Supergene

Sulphide

     0.30        114        0.58        0.07        —          26        0.59        0.10        —          140        0.58        0.07        —          112        0.79        0.11        —    

ROM

     0.10        —          —          —          —          9.4        0.37        —          —          9.4        0.37        —          —          9.4        0.37        0.14        —    

Transitional

Sulphide

     0.20        19        0.70        —          110        1.9        0.52        —          50        21        0.69        —          100        —          —          —          —    

Hypogene

Sulphide

     0.20        530        0.47        —          200        725        0.47        —          130        1,260        0.46        —          160        —          —          —          —    

Mt – Million Tonnes, TCu – Total Copper, SCu – Acid Soluble Copper, Mo – Molybdenum, % - Weight Per Cent, ppm – Parts per Million, ROM – Run of Mine

Table Footnotes:

 

1) These Ore Reserves were estimated by C González (MAusIMM) and are an update to Ore Reserves reported by F Barrera (MAusIMM) for the year ended 30 June 2017 in the 2017 BHP Annual Report which can be found at www.bhp.com. Both Mr González and Mr Barrera are full time employees of BHP and have sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity which they are undertaking to qualify as Competent Persons as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. C González and F Barrera consent to the inclusion in this report of the matters based on the form and context in which they appear.
2) This is a first time Ore Reserves estimate declaration for Spence Transitional and Hypogene Sulphide Ore Types and revised estimate for other Ore Types. The Ore Reserves are supported by a forward-looking copper commodity price protocol based on supply and demand assumptions.
3) Ore Reserves are estimated as dry metric tonnes, on the basis of ore delivered to the process plant.
4) The revised Spence Reserves Life is estimated as 40 years based on the current stated Ore Reserves estimate divided by the current approved nominated production rate as at 17 August 2017.
5) The Ore Reserves tabulated are held within existing, permitted mining tenements. BHP’s mineral leases are of sufficient duration (or convey a legal right to renew for sufficient duration) to enable all reserves on the leased properties to be mined in accordance with current production schedules. Our Ore Reserves may include areas where some additional approvals remain outstanding, but where, based on the technical investigations we carry out as part of our planning process and our knowledge and experience of the approvals process, we expect that such approvals will be obtained as part of the normal course of business and within the time frame required by the current life of mine schedule.
6) The SGO project is not considered material at the BHP Group level.

 

 

BHP Operational Review for the quarter ended 30 September 2017    7


Iron Ore

Production

 

     Sep Q17      Sep Q17
vs

Sep Q16
    Sep Q17
vs

Jun Q17
 

Iron ore(i) (kt)

     55,587        (3 %)      (8 %) 

 

(i) Represents Western Australia Iron Ore (WAIO). Excludes production from Samarco.

Iron ore – Total iron ore production for the September 2017 quarter decreased by three per cent to 56 Mt, or 64 Mt on a 100 per cent basis. Guidance for the 2018 financial year remains unchanged at between 239 and 243 Mt, or between 275 and 280 Mt on a 100 per cent basis, with volumes weighted to the last three quarters of the year.

WAIO production for the September 2017 quarter was lower, as expected. Record production at Jimblebar was more than offset by the impact of lower opening stockpile levels, following the fire at the Mt Whaleback screening plant in June 2017, and planned maintenance in the September 2017 quarter. Mine productivity improved in the quarter as a result of increased plant availability and consistent feed rates. Stockpile levels have been rebuilt and are expected to be partially drawn down in the next quarter. Port debottlenecking activities will extend into the December 2017 quarter. BHP continues to work with the relevant authorities in relation to the necessary approvals to increase system capacity to 290 Mtpa (100 per cent basis).

Mining and processing operations at Samarco remain suspended following the failure of the Fundão tailings dam and Santarém water dam on 5 November 2015.

Coal    

Production    

 

     Sep Q17      Sep Q17
vs

Sep Q16
    Sep Q17
vs

Jun Q17
 

Metallurgical coal (kt)

     10,567        0     24

Energy coal (kt)

     6,732        (2 %)      (18 %) 

Metallurgical coal – Metallurgical coal production for the September 2017 quarter was flat at 11 Mt. Guidance for the 2018 financial year remains unchanged at between 44 and 46 Mt.

At Queensland Coal, mining operations have recovered following the impacts of Cyclone Debbie, with record production at Saraji and increased production at Peak Downs and Caval Ridge, underpinned by an improvement in trucking hours and utilisation of latent wash-plant capacity. This was offset by lower production at Broadmeadow due to difficult roof conditions.

The Caval Ridge Southern Circuit project is progressing according to plan, with production expected to ramp-up early in the 2019 financial year.

Energy coal – Energy coal production for the September 2017 quarter decreased by two per cent to 7 Mt. Guidance for the 2018 financial year is unchanged at approximately 29 to 30 Mt.

New South Wales Energy Coal production increased by seven per cent as it benefitted from improved stripping performance and additional bypass coal. This was offset by a 15 per cent decrease in volumes at Cerrejón, which was constrained following the impact of extreme wet weather at the end of June 2017.

 

 

BHP Operational Review for the quarter ended 30 September 2017    8


Other    

Nickel production    

 

     Sep Q17      Sep Q17
vs

Sep Q16
    Sep Q17
vs

Jun Q17
 

Nickel (kt)

     22.8        21     (10 %) 

Nickel – Nickel West production for the September 2017 quarter increased by 21 per cent to 23 kt of nickel primarily due to increased production from the Leinster and Mt Keith operations. Nickel production for the 2018 financial year is expected to remain broadly unchanged from the 2017 financial year.

Potash project    

 

Project and ownership

   Investment
(US$m)
    

Scope

  

Progress

Jansen Potash

(Canada)

100%

     2,600      Investment to finish the excavation and lining of the production and service shafts, and to continue the installation of essential surface infrastructure and utilities.    The project is 73% complete and within the approved budget. Shaft excavation is progressing.

Minerals exploration

Minerals exploration expenditure for the September 2017 quarter was US$43 million, of which US$32 million was expensed. Greenfield minerals exploration is predominantly focused on advancing copper targets within Chile, Ecuador, Peru, Canada, South Australia and the South-West United States.

 

 

Variance analysis relates to the relative performance of BHP and/or its operations during the September 2017 quarter compared with the September 2016 quarter, unless otherwise noted. Production volumes, sales volumes and capital and exploration expenditure from subsidiaries are reported on a 100 per cent basis; production and sales volumes from equity accounted investments and other operations are reported on a proportionate consolidation basis. Copper equivalent production based on 2017 financial year average realised prices.

The following footnotes apply to this Operational Review:

 

(1) Excludes production from Samarco.

The following abbreviations may have been used throughout this report: barrels (bbl); billion cubic feet (bcf); cost and freight (CFR); cost, insurance and freight (CIF); dry metric tonne unit (dmtu); free on board (FOB); grams per tonne (g/t); kilograms per tonne (kg/t); kilometre (km); metre (m); million barrels of oil equivalent (MMboe); million cubic feet per day (MMcf/d); million tonnes (Mt); million tonnes per annum (Mtpa); ounces (oz); pounds (lb); thousand barrels of oil equivalent (Mboe); thousand ounces (koz); thousand standard cubic feet (Mscf); thousand tonnes (kt); thousand tonnes per annum (ktpa); thousand tonnes per day (ktpd); tonnes (t); and wet metric tonnes (wmt).

 

 

BHP Operational Review for the quarter ended 30 September 2017    9


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BHP Operational Review for the quarter ended 30 September 2017    10


Production summary      
           Quarter ended      Year to date  
     BHP
interest
    Sep
2016
     Dec
2016
     Mar
2017
     Jun
2017
     Sep
2017
     Sep
2017
     Sep
2016
 

Petroleum (1)

                      

Petroleum

                      

Crude oil, condensate and NGL (Mboe)

                      

Onshore US

       8,288        8,143        9,439        8,501        7,079        7,079        8,288  

Conventional

       15,959        15,768        15,369        15,612        15,090        15,090        15,959  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       24,247        23,911        24,808        24,113        22,169        22,169        24,247  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Natural gas (bcf)

                      

Onshore US

       73.9        67.8        66.1        67.2        61.4        61.4        73.9  

Conventional

       107.8        97.1        88.4        99.5        107.3        107.3        107.8  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       181.7        164.9        154.5        166.7        168.7        168.7        181.7  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
                      
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum production (MMboe)

       54.5        51.4        50.6        51.9        50.3        50.3        54.5  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Copper (2)

                      

Copper

                      

Payable metal in concentrate (kt)

                      

Escondida (3)

     57.5     147.0        162.6        67.6        162.4        196.3        196.3        147.0  

Antamina

     33.8     34.1        32.0        29.2        38.5        35.9        35.9        34.1  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       181.1        194.6        96.8        200.9        232.2        232.2        181.1  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Cathode (kt)

                      

Escondida (3)

     57.5     70.5        71.5        27.2        62.8        71.9        71.9        70.5  

Pampa Norte (4)

     100     62.1        53.8        66.1        72.3        58.0        58.0        62.1  

Olympic Dam

     100     40.9        37.2        36.8        51.4        42.0        42.0        40.9  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       173.5        162.5        130.1        186.5        171.9        171.9        173.5  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
                      
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total copper (kt)

       354.6        357.1        226.9        387.4        404.1        404.1        354.6  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Lead

                      

Payable metal in concentrate (t)

                      

Antamina

     33.8     1,146        1,220        1,308        1,799        1,415        1,415        1,146  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       1,146        1,220        1,308        1,799        1,415        1,415        1,146  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Zinc

                      

Payable metal in concentrate (t)

                      

Antamina

     33.8     15,367        22,406        20,653        29,076        29,201        29,201        15,367  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       15,367        22,406        20,653        29,076        29,201        29,201        15,367  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Gold

                      

Payable metal in concentrate (troy oz)

                      

Escondida (3)

     57.5     27,561        37,784        11,572        33,941        50,525        50,525        27,561  

Olympic Dam (refined gold)

     100     24,366        29,651        21,941        28,188        13,101        13,101        24,366  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       51,927        67,435        33,513        62,129        63,626        63,626        51,927  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Silver

                      

Payable metal in concentrate (troy koz)

                      

Escondida (3)

     57.5     1,229        1,323        540        1,234        1,737        1,737        1,229  

Antamina

     33.8     1,345        1,446        1,301        1,691        1,596        1,596        1,345  

Olympic Dam (refined silver)

     100     163        188        174        243        131        131        163  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       2,737        2,957        2,015        3,168        3,464        3,464        2,737  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Uranium

                      

Payable metal in concentrate (t)

                      

Olympic Dam

     100     916        1,060        948        737        880        880        916  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       916        1,060        948        737        880        880        916  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Molybdenum

                      

Payable metal in concentrate (t)

                      

Antamina

     33.8     561        225        30        328        402        402        561  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       561        225        30        328        402        402        561  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

 

BHP Operational Review for the quarter ended 30 September 2017    11


Production summary      
    

BHP
interest

    Quarter ended      Year to date  
     Sep
2016
     Dec
2016
     Mar
2017
     Jun
2017
     Sep
2017
     Sep
2017
     Sep
2016
 

Iron Ore

                      

Iron Ore

                      

Production (kt) (5)

                      

Newman

     85     18,008        17,751        16,283        16,241        13,842        13,842        18,008  

Area C Joint Venture

     85     12,384        12,179        11,165        13,016        13,099        13,099        12,384  

Yandi Joint Venture

     85     15,729        17,555        14,656        17,415        14,559        14,559        15,729  

Jimblebar (6)

     85     6,057        5,178        4,824        5,891        6,283        6,283        6,057  

Wheelarra

     85     5,409        7,386        6,647        7,578        7,804        7,804        5,409  

Samarco

     50     —          —          —          —          —          —          —    
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       57,587        60,049        53,575        60,141        55,587        55,587        57,587  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Coal

                      

Metallurgical coal

                      

Production (kt) (7)

                      

BMA

     50     8,384        8,684        7,996        6,394        8,296        8,296        8,384  

BHP Mitsui Coal (8)

     80     2,145        1,929        2,138        2,100        2,271        2,271        2,145  

Haju (9)

     75     102        27        —          —          —          —          102  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       10,631        10,640        10,134        8,494        10,567        10,567        10,631  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Energy coal

                      

Production (kt)

                      

USA

     100     451        —          —          —          —          —          451  

Australia

     100     3,952        3,851        4,662        5,711        4,235        4,235        3,952  

Colombia

     33.3     2,928        2,800        2,756        2,475        2,497        2,497        2,928  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       7,331        6,651        7,418        8,186        6,732        6,732        7,331  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Other

                      

Nickel

                      

Saleable production (kt)

                      

Nickel West

     100     18.8        22.1        19.0        25.2        22.8        22.8        18.8  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       18.8        22.1        19.0        25.2        22.8        22.8        18.8  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

(1) LPG and ethane are reported as natural gas liquids (NGL). Product-specific conversions are made and NGL is reported in barrels of oil equivalent (boe). Total boe conversions are based on 6 bcf of natural gas equals 1 MMboe.
(2) Metal production is reported on the basis of payable metal.
(3) Shown on a 100% basis. BHP interest in saleable production is 57.5%.
(4) Includes Cerro Colorado and Spence.
(5) Iron ore production is reported on a wet tonnes basis.
(6) Shown on a 100% basis. BHP interest in saleable production is 85%.
(7) Metallurgical coal production is reported on the basis of saleable product. Production figures include some thermal coal.
(8) Shown on a 100% basis. BHP interest in saleable production is 80%.
(9) Shown on a 100% basis. BHP interest in saleable production is 75%.

Throughout this report figures in italics indicate that this figure has been adjusted since it was previously reported.

 

 

BHP Operational Review for the quarter ended 30 September 2017    12


Production and sales report      
          Quarter ended      Year to date  
          Sep
2016
     Dec
2016
     Mar
2017
     Jun
2017
     Sep
2017
     Sep
2017
     Sep
2016
 

Petroleum (1)

                       

Bass Strait

                       

Crude oil and condensate

   (Mboe)      1,922        1,770        1,355        1,552        1,815        1,815        1,922  

NGL

   (Mboe)      2,102        1,460        1,236        1,661        1,950        1,950        2,102  

Natural gas

   (bcf)      41.9        31.3        28.7        37.4        42.6        42.6        41.9  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      11.0        8.4        7.4        9.4        10.9        10.9        11.0  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

North West Shelf

                       

Crude oil and condensate

   (Mboe)      1,486        1,468        1,239        1,314        1,474        1,474        1,486  

NGL

   (Mboe)      292        263        200        209        227        227        292  

Natural gas

   (bcf)      38.7        36.9        32.2        32.5        36.2        36.2        38.7  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      8.2        7.9        6.8        6.9        7.7        7.7        8.2  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Pyrenees

                       

Crude oil and condensate

   (Mboe)      1,676        1,726        1,509        1,606        1,510        1,510        1,676  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      1.7        1.7        1.5        1.6        1.5        1.5        1.7  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Other Australia (2)

                       

Crude oil and condensate

   (Mboe)      10        8        8        9        9        9        10  

Natural gas

   (bcf)      17.5        17.1        15.2        16.3        16.1        16.1        17.5  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      2.9        2.9        2.5        2.7        2.7        2.7        2.9  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Atlantis (3)

                       

Crude oil and condensate

   (Mboe)      3,054        3,263        3,881        3,637        3,022        3,022        3,054  

NGL

   (Mboe)      208        207        295        213        218        218        208  

Natural gas

   (bcf)      1.5        1.6        2.1        1.9        1.6        1.6        1.5  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      3.5        3.7        4.5        4.2        3.5        3.5        3.5  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Mad Dog (3)

                       

Crude oil and condensate

   (Mboe)      950        1,170        1,185        1,167        1,020        1,020        950  

NGL

   (Mboe)      36        52        59        68        44        44        36  

Natural gas

   (bcf)      0.1        0.2        0.2        0.2        0.1        0.1        0.1  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      1.0        1.3        1.3        1.3        1.1        1.1        1.0  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Shenzi (3)

                       

Crude oil and condensate

   (Mboe)      2,632        2,692        2,675        2,588        2,291        2,291        2,632  

NGL

   (Mboe)      94        131        161        179        141        141        94  

Natural gas

   (bcf)      0.5        0.5        0.5        0.6        0.4        0.4        0.5  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      2.8        2.9        2.9        2.9        2.5        2.5        2.8  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Eagle Ford (4)

                       

Crude oil and condensate

   (Mboe)      3,871        4,008        5,451        4,278        3,457        3,457        3,871  

NGL

   (Mboe)      2,268        2,159        2,354        2,240        1,856        1,856        2,268  

Natural gas

   (bcf)      16.5        15.2        17.0        15.1        13.8        13.8        16.5  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      8.9        8.7        10.6        9.0        7.6        7.6        8.9  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Permian (4)

                       

Crude oil and condensate

   (Mboe)      1,415        1,378        1,202        1,336        1,179        1,179        1,415  

NGL

   (Mboe)      734        580        428        646        587        587        734  

Natural gas

   (bcf)      4.4        4.4        4.0        6.2        4.5        4.5        4.4  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      2.9        2.7        2.3        3.0        2.5        2.5        2.9  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Haynesville (4)

                       

Crude oil and condensate

   (Mboe)      —          3        1        1        —          —          —    

NGL

   (Mboe)      —          15        3        —          —          —          —    

Natural gas

   (bcf)      28.2        24.0        22.0        21.4        21.5        21.5        28.2  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      4.7        4.0        3.7        3.6        3.6        3.6        4.7  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Fayetteville (4)

                       

Natural gas

   (bcf)      24.8        24.2        23.1        24.5        21.6        21.6        24.8  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      4.1        4.0        3.9        4.1        3.6        3.6        4.1  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

 

BHP Operational Review for the quarter ended 30 September 2017    13


Production and sales report      
          Quarter ended      Year to date  
      Sep
2016
     Dec
2016
     Mar
2017
     Jun
2017
     Sep
2017
     Sep
2017
     Sep
2016
 

Petroleum (1) (continued)

                       

Trinidad/Tobago

                       

Crude oil and condensate

   (Mboe)      140        156        127        139        118        118        140  

Natural gas

   (bcf)      6.4        8.4        8.4        9.4        9.7        9.7        6.4  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      1.2        1.6        1.5        1.7        1.7        1.7        1.2  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Other Americas (3) (5)

                       

Crude oil and condensate

   (Mboe)      275        269        257        238        229        229        275  

NGL

   (Mboe)      1        5        6        10        5        5        1  

Natural gas

   (bcf)      0.1        0.1        0.1        0.1        0.1        0.1        0.1  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      0.3        0.3        0.3        0.3        0.3        0.3        0.3  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

UK

                       

Crude oil and condensate

   (Mboe)      69        63        72        64        40        40        69  

NGL

   (Mboe)      22        49        32        16        39        39        22  

Natural gas

   (bcf)      1.1        1.0        1.0        1.1        0.5        0.5        1.1  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      0.3        0.3        0.3        0.3        0.2        0.2        0.3  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Algeria

                       

Crude oil and condensate

   (Mboe)      990        1,016        1,072        942        938        938        990  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      1.0        1.0        1.1        0.9        0.9        0.9        1.0  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

BHP Petroleum

                       

Crude oil and condensate

                       

Onshore US

   (Mboe)      5,286        5,389        6,654        5,615        4,636        4,636        5,286  

Conventional

   (Mboe)      13,204        13,601        13,380        13,256        12,466        12,466        13,204  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

   (Mboe)      18,490        18,990        20,034        18,871        17,102        17,102        18,490  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

NGL

                       

Onshore US

   (Mboe)      3,002        2,754        2,785        2,886        2,443        2,443        3,002  

Conventional

   (Mboe)      2,755        2,167        1,989        2,356        2,624        2,624        2,755  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

   (Mboe)      5,757        4,921        4,774        5,242        5,067        5,067        5,757  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Natural gas

                       

Onshore US

   (bcf)      73.9        67.8        66.1        67.2        61.4        61.4        73.9  

Conventional

   (bcf)      107.8        97.1        88.4        99.5        107.3        107.3        107.8  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

   (bcf)      181.7        164.9        154.5        166.7        168.7        168.7        181.7  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

                       

Onshore US

   (Mboe)      20,605        19,443        20,456        19,701        17,312        17,312        20,605  

Conventional

   (Mboe)      33,926        31,951        30,102        32,195        32,973        32,973        33,926  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

   (Mboe)      54,530        51,394        50,558        51,896        50,286        50,286        54,530  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

(1)    Total boe conversions are based on 6 bcf of natural gas equals 1 MMboe. Negative production figures represent finalisation adjustments.

(2)    Other Australia includes Minerva and Macedon.

(3)    Gulf of Mexico volumes are net of royalties.

(4)    Onshore US volumes are net of mineral holder royalties.

(5)    Other Americas includes Neptune, Genesis and Overriding Royalty Interest.

     

     

     

     

     

 

 

BHP Operational Review for the quarter ended 30 September 2017    14


Production and sales report      
          Quarter ended     Year to date  
      Sep
2016
    Dec
2016
    Mar
2017
    Jun
2017
    Sep
2017
    Sep
2017
    Sep
2016
 

Copper

                 

Metals production is payable metal unless otherwise stated.

 

Escondida, Chile (1)

                 

Material mined

   (kt)      106,504       90,863       26,045       93,389       104,867       104,867       106,504  

Sulphide ore milled

   (kt)      20,787       19,866       8,054       18,777       24,080       24,080       20,787  

Average copper grade

   (%)      0.87     1.02     1.01     1.07     1.06     1.06     0.87

Production ex mill

   (kt)      153.2       168.6       68.7       167.0       204.2       204.2       153.2  

Production

                 

Payable copper

   (kt)      147.0       162.6       67.6       162.4       196.3       196.3       147.0  

Copper cathode (EW)

   (kt)      70.5       71.5       27.2       62.8       71.9       71.9       70.5  

- Oxide leach

   (kt)      26.8       24.4       8.9       20.3       22.4       22.4       26.8  

- Sulphide leach

   (kt)      43.7       47.1       18.3       42.5       49.5       49.5       43.7  
     

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total copper

   (kt)      217.5       234.1       94.8       225.2       268.2       268.2       217.5  
     

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Payable gold concentrate

   (troy oz)      27,561       37,784       11,572       33,941       50,525       50,525       27,561  

Payable silver concentrate

   (troy koz)      1,229       1,323       540       1,234       1,737       1,737       1,229  

Sales

                 

Payable copper

   (kt)      134.9       172.7       63.7       163.3       195.1       195.1       134.9  

Copper cathode (EW)

   (kt)      65.6       71.8       39.4       56.0       61.6       61.6       65.6  

Payable gold concentrate

   (troy oz)      27,561       37,784       11,572       33,941       50,525       50,525       27,561  

Payable silver concentrate

   (troy koz)      1,229       1,323       540       1,234       1,737       1,737       1,229  

(1)    Shown on a 100% basis. BHP interest in saleable production is 57.5%.    

     

Pampa Norte, Chile

                 

Cerro Colorado

                 

Material mined

   (kt)      13,011       14,286       15,178       15,760       21,381       21,381       13,011  

Ore milled

   (kt)      3,241       3,342       4,179       4,411       3,951       3,951       3,241  

Average copper grade

   (%)      0.68     0.65     0.57     0.53     0.62     0.62     0.68

Production

                 

Copper cathode (EW)

   (kt)      17.1       12.1       16.7       18.8       13.3       13.3       17.1  

Sales

                 

Copper cathode (EW)

   (kt)      16.4       13.7       15.6       19.8       12.3       12.3       16.4  

Spence

                 

Material mined

   (kt)      23,638       22,635       22,939       24,230       22,314       22,314       23,638  

Ore milled

   (kt)      4,713       5,187       5,225       4,968       5,375       5,375       4,713  

Average copper grade

   (%)      1.17     1.19     1.09     1.13     1.21     1.21     1.17

Production

                 

Copper cathode (EW)

   (kt)      45.0       41.7       49.4       53.5       44.7       44.7       45.0  

Sales

                 

Copper cathode (EW)

   (kt)      41.2       41.5       49.0       55.7       43.0       43.0       41.2  

 

 

BHP Operational Review for the quarter ended 30 September 2017    15


Production and sales report      
          Quarter ended     Year to date  
      Sep
2016
    Dec
2016
    Mar
2017
    Jun
2017
    Sep
2017
    Sep
2017
    Sep
2016
 

Copper (continued)

                 

Metals production is payable metal unless otherwise stated.

 

Antamina, Peru

                 

Material mined (100%)

   (kt)      65,111       61,355       55,771       62,254       59,216       59,216       65,111  

Sulphide ore milled (100%)

   (kt)      13,522       13,399       11,955       13,229       12,822       12,822       13,522  

Average head grades

                 

- Copper

   (%)      0.84     0.84     0.88     1.00     0.94     0.94     0.84

- Zinc

   (%)      0.60     0.83     0.84     0.95     0.99     0.99     0.60

Production

                 

Payable copper

   (kt)      34.1       32.0       29.2       38.5       35.9       35.9       34.1  

Payable zinc

   (t)      15,367       22,406       20,653       29,076       29,201       29,201       15,367  

Payable silver

   (troy koz)      1,345       1,446       1,301       1,691       1,596       1,596       1,345  

Payable lead

   (t)      1,146       1,220       1,308       1,799       1,415       1,415       1,146  

Payable molybdenum

   (t)      561       225       30       328       402       402       561  

Sales

                 

Payable copper

   (kt)      32.8       33.0       30.2       36.9       31.9       31.9       32.8  

Payable zinc

   (t)      16,043       22,334       23,669       27,936       25,224       25,224       16,043  

Payable silver

   (troy koz)      1,277       1,388       1,304       1,513       1,475       1,475       1,277  

Payable lead

   (t)      767       1,100       1,475       1,493       1,624       1,624       767  

Payable molybdenum

   (t)      648       476       —         —         168       168       648  

Olympic Dam, Australia

                 

Material mined (1)

   (kt)      2,204       1,887       1,943       1,974       1,851       1,851       2,204  

Ore milled

   (kt)      2,279       2,116       2,112       2,097       2,302       2,302       2,279  

Average copper grade

   (%)      1.97     2.00     2.07     2.30     2.10     2.10     1.97

Average uranium grade

   (kg/t)      0.60       0.68       0.61       0.58       0.55       0.55       0.60  

Production

                 

Copper cathode (ER and EW)

   (kt)      40.9       37.2       36.8       51.4       42.0       42.0       40.9  

Uranium oxide concentrate

   (t)      916       1,060       948       737       880       880       916  

Refined gold

   (troy oz)      24,366       29,651       21,941       28,188       13,101       13,101       24,366  

Refined silver

   (troy koz)      163       188       174       243       131       131       163  

Sales

                 

Copper cathode (ER and EW)

   (kt)      37.5       41.2       33.5       51.5       31.6       31.6       37.5  

Uranium oxide concentrate

   (t)      1,085       883       839       1,298       680       680       1,085  

Refined gold

   (troy oz)      21,901       28,234       22,333       24,726       22,435       22,435       21,901  

Refined silver

   (troy koz)      184       203       108       251       219       219       184  

(1)    Material mined refers to run of mine ore mined and hoisted.    

     

 

 

BHP Operational Review for the quarter ended 30 September 2017    16


Production and sales report      
          Quarter ended      Year to date  
      Sep
2016
     Dec
2016
     Mar
2017
     Jun
2017
     Sep
2017
     Sep
2017
     Sep
2016
 

Iron Ore

                       

Iron ore production and sales are reported on a wet tonnes basis.

 

Pilbara, Australia

                       

Production

                       

Newman

   (kt)      18,008        17,751        16,283        16,241        13,842        13,842        18,008  

Area C Joint Venture

   (kt)      12,384        12,179        11,165        13,016        13,099        13,099        12,384  

Yandi Joint Venture

   (kt)      15,729        17,555        14,656        17,415        14,559        14,559        15,729  

Jimblebar (1)

   (kt)      6,057        5,178        4,824        5,891        6,283        6,283        6,057  

Wheelarra

   (kt)      5,409        7,386        6,647        7,578        7,804        7,804        5,409  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total production

   (kt)      57,587        60,049        53,575        60,141        55,587        55,587        57,587  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total production (100%)

   (kt)      66,681        69,730        62,177        69,714        64,287        64,287        66,681  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Sales

                       

Lump

   (kt)      14,156        14,127        12,804        15,104        13,896        13,896        14,156  

Fines

   (kt)      42,278        45,447        41,043        46,249        40,733        40,733        42,278  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

   (kt)      56,434        59,574        53,847        61,353        54,629        54,629        56,434  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total sales (100%)

   (kt)      65,368        69,196        62,513        71,149        63,322        63,322        65,368  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
(1) Shown on a 100% basis. BHP interest in saleable production is 85%.      

Samarco, Brazil (1)

                       

Production

   (kt)      —          —          —          —          —          —          —    

Sales

   (kt)      12        —          35        —          —          —          12  

(1)    Mining and processing operations remain suspended following the failure of the Fundão tailings dam and Santarém water dam on 5 November 2015.

     

 

 

BHP Operational Review for the quarter ended 30 September 2017    17


Production and sales report      
          Quarter ended      Year to date  
          Sep
2016
     Dec
2016
     Mar
2017
     Jun
2017
     Sep
2017
     Sep
2017
     Sep
2016
 

Coal

                       

Coal production is reported on the basis of saleable product.

 

Queensland Coal

                       

Production (1)

                       

BMA

                       

Blackwater

   (kt)      1,981        1,855        1,694        1,766        1,985        1,985        1,981  

Goonyella

   (kt)      2,123        2,204        1,871        1,157        1,639        1,639        2,123  

Peak Downs

   (kt)      1,520        1,715        1,582        1,238        1,602        1,602        1,520  

Saraji

   (kt)      1,238        1,307        1,276        913        1,414        1,414        1,238  

Daunia

   (kt)      646        680        674        560        662        662        646  

Caval Ridge

   (kt)      876        923        899        760        994        994        876  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total BMA

   (kt)      8,384        8,684        7,996        6,394        8,296        8,296        8,384  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

BHP Mitsui Coal (2)

                       

South Walker Creek

   (kt)      1,341        1,080        1,354        1,348        1,400        1,400        1,341  

Poitrel

   (kt)      804        849        784        752        871        871        804  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total BHP Mitsui Coal

   (kt)      2,145        1,929        2,138        2,100        2,271        2,271        2,145  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total Queensland Coal

   (kt)      10,529        10,613        10,134        8,494        10,567        10,567        10,529  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Sales

                       

Coking coal

   (kt)      7,240        7,658        7,133        5,496        7,934        7,934        7,240  

Weak coking coal

   (kt)      2,799        2,659        2,761        2,502        3,150        3,150        2,799  

Thermal coal

   (kt)      206        154        96        142        102        102        206  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

   (kt)      10,245        10,471        9,990        8,140        11,186        11,186        10,245  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

(1)    Production figures include some thermal coal.

(2)    Shown on a 100% basis. BHP interest in saleable production is 80%.

     

     

Haju, Indonesia (1)

                       

Production

   (kt)      102        27        —          —          —          —          102  

Sales - export

   (kt)      117        —          —          —          —          —          117  

(1)    Shown on 100% basis. BHP interest in saleable production is 75%. BHP completed the sale of IndoMet Coal on 14 October 2016.

     

New Mexico, USA

                       

Production

                       

Navajo Coal (1)

   (kt)      451        —          —          —          —          —          451  

San Juan Coal (2)

   (kt)      —          —          —          —          —          —          —    
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

   (kt)      451        —          —          —          —          —          451  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Sales thermal coal - local utility

        105        —          —          —          —          —          105  

(1)    The divestment of Navajo Coal was completed on 29 July 2016, with no further production reported by BHP. Management of Navajo Coal was transferred to Navajo Transitional Energy Company on 31 December 2016.

(2)    BHP completed the sale of San Juan Mine on 31 January 2016.

     

     

NSW Energy Coal, Australia

                       

Production

   (kt)      3,952        3,851        4,662        5,711        4,235        4,235        3,952  

Sales

                       

Export thermal coal

   (kt)      3,640        3,539        4,407        4,913        3,622        3,622        3,640  

Inland thermal coal

   (kt)      331        311        431        327        405        405        331  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

   (kt)      3,971        3,850        4,838        5,240        4,027        4,027        3,971  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Cerrejón, Colombia

                       

Production

   (kt)      2,928        2,800        2,756        2,475        2,497        2,497        2,928  

Sales thermal coal - export

   (kt)      2,905        2,722        2,613        2,803        2,518        2,518        2,905  

 

 

BHP Operational Review for the quarter ended 30 September 2017    18


Production and sales report      
          Quarter ended      Year to date  
      Sep
2016
     Dec
2016
     Mar
2017
     Jun
2017
     Sep
2017
     Sep
2017
     Sep
2016
 

Other

                       

Nickel production is reported on the basis of saleable product

 

Nickel West, Australia

                       

Production

                       

Nickel contained in concentrate

   (kt)      0.3        0.2        0.2        —          —          —          0.3  

Nickel contained in finished matte

   (kt)      1.8        4.1        2.3        5.3        6.8        6.8        1.8  

Nickel metal

   (kt)      16.7        17.8        16.5        19.9        16.0        16.0        16.7  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total nickel production

   (kt)      18.8        22.1        19.0        25.2        22.8        22.8        18.8  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Sales

                       

Nickel contained in concentrate

   (kt)      0.3        0.2        0.2        —          —          —          0.3  

Nickel contained in finished matte

   (kt)      1.8        4.1        2.2        4.9        4.6        4.6        1.8  

Nickel metal

   (kt)      16.5        17.6        17.1        18.1        16.6        16.6        16.5  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total nickel sales

   (kt)      18.6        21.9        19.5        23.0        21.2        21.2        18.6  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

 

BHP Operational Review for the quarter ended 30 September 2017    19


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

      BHP Billiton Limited and BHP Billiton Plc
Date: October 18, 2017     By:  

/s/ Rachel Agnew

    Name:   Rachel Agnew
    Title:   Company Secretary