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

July 19, 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

   19 July 2017

Release Number

   19/17

BHP OPERATIONAL REVIEW FOR THE YEAR ENDED 30 JUNE 2017

 

  Achieved full year production guidance for petroleum and iron ore, with annual production records at Western Australia Iron Ore (WAIO), Spence and two Queensland Coal mines.

 

  Lower copper production reflected the impact of industrial action at Escondida and the power outage and unplanned maintenance at Olympic Dam. Lower metallurgical coal volumes as a result of damage to third party rail infrastructure caused by Cyclone Debbie.

 

  We expect to achieve full year unit cost guidance at WAIO and Conventional petroleum, however industrial action and Cyclone Debbie have impacted unit costs at Escondida and Queensland Coal respectively.

 

  Group copper equivalent production expected to increase by 7% in the 2018 financial year.

 

  In Onshore US, development activity is increasing with up to 10 rigs operating in the 2018 financial year.

 

  Divestment of non-core Onshore US acreage is progressing, with the sale of a portion of the southern Hawkville anticipated in the September 2017 quarter.

 

  In Petroleum exploration, drilling of the Wildling-2 appraisal well in the Gulf of Mexico is continuing, with results expected in the September 2017 quarter.

 

  All major projects under development are tracking to plan.

 

Production

   FY17      vs FY16      

Petroleum (MMboe)

     208        (13 %)    Deferral of development activity in Onshore US for value and natural field decline in Conventional assets.

Copper (kt)

     1,326        (16 %)    Reduced volumes following industrial action at Escondida and the power outage and unplanned maintenance at Olympic Dam.

Iron ore(1) (Mt)

     231        4   Record WAIO volumes reflects productivity improvements across the supply chain and additional capacity at Jimblebar.

Metallurgical coal(1) (Mt)

     40        (6 %)    Record volumes at two Queensland Coal mines more than offset by the impacts from Cyclone Debbie.

Energy coal(1) (Mt)

     29        7   Strong performance at both NSWEC and Cerrejón.

BHP Chief Executive Officer, Andrew Mackenzie said: “Our people have stepped up to unlock low-cost latent capacity and achieve strong productivity gains across our tier one assets.

Improved productivity led to record annual production at Western Australia Iron Ore, Spence and two Queensland Coal mines while production guidance was achieved by Petroleum and Western Australia Iron Ore. Copper production is expected to rebound strongly in the 2018 financial year with the commissioning of the Escondida Water Supply project and ramp-up of the Los Colorados Extension project during the September 2017 quarter to enable utilisation of Escondida’s three concentrators.

In Petroleum, the recently approved Mad Dog phase 2 project will extend low-risk oil volumes as supply tightens while in the near-term, Onshore US development activity is to increase with up to 10 rigs planned for the 2018 financial year.

Our relentless focus on safety, productivity and capital discipline will support strong growth in shareholder value.”

 

 

   1


Summary

Operational performance

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

 

Production

   FY17      Jun
2017
Qtr
     FY17
vs
FY16
    Jun Q17
vs
Jun Q16
    Jun Q17
vs
Mar Q17
    FY18
guidance
    FY18e
vs FY17
 

Petroleum (MMboe)

     208        52        (13 %)      (7 %)      3     180 -190       (9%) - (13 %) 

Onshore US (MMboe)

     80        20        (26 %)      (15 %)      (4 %)      61 - 67       (16%) - (24 %) 

Conventional (MMboe)

     128        32        (2 %)      (2 %)      7     119 -123       (4%) -(7 %) 

Copper (kt)

     1,326        387        (16 %)      (6 %)      71     1,655 -1,790       25% - 35

Escondida (kt)

     772        225        (21 %)      (16 %)      138     1,130 -1,230       46% - 59

Other copper(i) (kt)

     554        162        (8 %)      12     23     525 -560       (5%) - 1

Iron ore(ii) (Mt)

     231        60        4     8     12     239 -243       3% - 5

WAIO (100% basis) (Mt)

     268        70        4     8     12     275 -280 (iii)      3% - 4

Metallurgical coal(ii) (Mt)

     40        8        (6 %)      (27 %)      (16 %)      44 - 46       10% - 15

Energy coal(ii) (Mt)

     29        8        7     30     10     29 - 30       0% - 3

 

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

Major development projects

During the year, the Bass Strait Longford Gas Conditioning Plant was fully commissioned and is running at design capacity, enabling full production from the Turrum and Kipper fields. The BHP Board also approved the Mad Dog Phase 2 project in the deepwater Gulf of Mexico. The Escondida Water Supply project achieved mechanical completion in the December 2016 quarter and was transitioned to operations effective 1 July 2017, following completion of project commissioning in June 2017.

At the end of the 2017 financial year, BHP had three major projects under development in Petroleum and Potash, with a combined budget of US$5.1 billion over the life of the projects.

Corporate update

BHP expects to record exceptional items of US$546 million (US$740 million post-tax) in the second half of the 2017 financial year. These items relate to idle capacity and other strike-related costs incurred as a result of the Escondida industrial action in the March 2017 quarter and Chilean withholding tax on a one-off dividend paid while a concessional tax rate was available.

 

Exceptional items to be recognised in the June 2017 half year

Charges/(credits)

(US$ million)

   Loss before
taxation
     Taxation     Loss after
taxation
 

Escondida industrial action costs

     546        (179     367  

Withholding tax on Chilean dividends

     —          373       373  

On 18 January 2017, Samarco and its shareholders, Vale S.A. and BHP Billiton Brasil, entered into a preliminary agreement with the Federal Prosecutors’ Office in Brazil in relation to the Samarco dam failure (Preliminary Agreement). The Preliminary Agreement outlines the process and timeline for negotiation of a settlement of the BRL 155 billion (approximately US$47.5 billion) and BRL 20 billion (approximately US$6.1 billion) Public Civil Claims relating to the dam failure. The Court has extended the final date for negotiation of a settlement until 30 October 2017, allowing for the continuation of the interim security arrangements provided to the Court on 24 January 2017 and the provision of ongoing expert advice to the Federal Prosecutors in respect of the remediation and compensation programs identified under the Framework Agreement.

 

 

BHP Operational Review for the year ended 30 June 2017    2


On 30 June 2017, BHP announced a total of US$250 million in financial support for the Renova Foundation and Samarco until 31 December 2017. The amount of US$174 million will be used to fund the Renova Foundation and will be offset against the Group’s provision for the Samarco dam failure. A short-term facility of up to US$76 million will be made available to Samarco to carry out remediation and stablisation work and to support Samarco’s operations. These funds will be released to Samarco only as required, and subject to achievement of key milestones. For the second half of the 2017 financial year, we are not yet in a position to provide an update to the ongoing potential financial impacts on BHP Billiton Brasil of the Samarco dam failure. Any financial impacts will continue to be classified as an exceptional item.

The above guidance will be updated should material information or events arise as the Group finalises its financial statements.

On 16 June 2017, the BHP Board elected Ken MacKenzie to succeed Jac Nasser as Chairman. Mr MacKenzie will assume the role of Chairman effective 1 September 2017, following Mr Nasser’s retirement as both Chairman and a Non-executive Director.

In July 2017, BHP filed an amendment to its 2016 20-F (2016 20-F/A) to restate its 2016 report on internal controls over financial reporting, as deficiencies were identified in the controls and processes that were used to determine the impairments of certain Onshore US assets. The identified deficiencies did not require any change to the carrying values of the Company’s Onshore US assets at 31 December 2016 or any prior period and there is no need for a restatement of any of the Group’s financial statements. A remediation plan has been implemented and we expect to confirm the controls are operating effectively as part of the 2017 financial year annual reporting process.

Marketing update

The average realised prices achieved for our major commodities are summarised in the table below. The majority of iron ore shipments were linked to the index price for the month of shipment, with price differentials predominantly a reflection of product quality and market fundamentals. The majority of metallurgical coal and energy coal exports were linked to the index price for the month of shipment or sold on the spot market at fixed or index-linked prices, with price differentials reflecting product quality.

 

Average realised prices(i)

   Jun H17      Dec H16      FY17      FY16      FY17
vs
FY16
    Jun H17
vs
Jun H16
    Jun H17
vs
Dec H16
 

Oil (crude and condensate) (US$/bbl)

     50        45        48        39        23     35     11

Natural gas (US$/Mscf)(ii)

     3.48        3.21        3.34        2.83        18     27     8

US natural gas (US$/Mscf)

     2.98        2.79        2.88        2.16        33     52     7

LNG (US$/Mscf)

     7.37        6.35        6.84        7.71        (11 %)      4     16

Copper (US$/lb)

     2.70        2.41        2.54        2.14        19     25     12

Iron ore (US$/wmt, FOB)

     62        55        58        44        32     41     13

Hard coking coal (US$/t)

     180        179        180        83        117     117     1

Weak coking coal (US$/t)

     121        122        121        69        75     73     (1 %) 

Thermal coal (US$/t)(iii)

     75        74        75        48        56     63     1

Nickel metal (US$/t)

     9,799        10,581        10,184        9,264        10     11     (7 %) 

 

(i) Based on provisional, unaudited estimates. Prices exclude third party product and internal sales, and represent the weighted average of various sales terms (for example: FOB, CIF and CFR), unless otherwise noted. Includes the impact of provisional pricing and finalisation adjustments. In Copper, the adjustment will increase Underlying EBITDA by US$27 million in the 2017 financial year.
(ii) Includes internal sales.
(iii) Export sales only; excludes Cerrejón. Includes thermal coal sales from metallurgical coal mines.

At 30 June 2017, the Group had 254 kt of outstanding copper sales that were revalued at a weighted average price of US$2.69 per pound. The final price of these sales will be determined in the 2018 financial year. In addition, 316 kt of copper sales from the 2016 financial year were subject to a finalisation adjustment in the current period. The provisional pricing and finalisation adjustments will increase Underlying EBITDA(2) by US$27 million in the 2017 financial year.

 

 

BHP Operational Review for the year ended 30 June 2017    3


Petroleum

Production

 

     FY17      Jun
2017
Qtr
     FY17
vs
FY16
    Jun Q17
vs
Jun Q16
    Jun Q17
vs
Mar Q17
 

Crude oil, condensate and natural gas liquids (MMboe)

     97        24        (16 %)      (9 %)      (3 %) 

Natural gas (bcf)

     668        167        (10 %)      (6 %)      8
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

 

Total petroleum production (MMboe)

     208        52        (13 %)      (7 %)      3
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

 

Total petroleum production – Total petroleum production for the 2017 financial year decreased by 13 per cent to 208 MMboe.

Petroleum production is forecast to decrease to between 180 and 190 MMboe in the 2018 financial year.

In Onshore US, volumes are expected to decline to between 61 and 67 MMboe as production from the phased ramp-up of development activity is more than offset by natural field decline. The expanded rig program is forecast to deliver production growth of approximately 35 per cent in the 2019 financial year, with investment plans subject to market conditions.

In our Conventional business, volumes are expected to decrease to between 119 and 123 MMboe as infill drilling and brownfield projects are more than offset by planned maintenance at Mad Dog and natural field decline across the portfolio.

Crude oil, condensate and natural gas liquids – Production for the 2017 financial year decreased by 16 per cent to 97 MMboe.

Onshore US liquids volumes decreased by 29 per cent to 34 MMboe as value accretive deferral of activity in the Black Hawk and natural field decline across all fields were partially offset by increased production from the Permian.

Conventional liquids volumes decreased by eight per cent to 63 MMboe as an additional infill well at Mad Dog and higher production at North West Shelf and Algeria partially offset planned maintenance at Atlantis and natural field decline across the portfolio.

Natural gas – Production for the 2017 financial year declined by 10 per cent to 668 bcf.

Divestment of our Pakistan gas business in December 2015 and lower Onshore US gas volumes as a result of deferred development activity for value, were partially offset by strong performance at Bass Strait and Macedon and increased LNG volumes at North West Shelf.

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 47% 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 3% complete.

Petroleum capital expenditure for the 2017 financial year declined by approximately 41 per cent to US$1.5 billion. In the 2018 financial year we expect an increase to approximately US$2.0 billion (including higher forecast capital creditor movements of approximately US$0.2 billion, the majority relating to Onshore US). 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 along with investments related to the recently approved Mad Dog Phase 2 project.

 

 

BHP Operational Review for the year ended 30 June 2017    4


Onshore US development activity

Onshore US drilling and development expenditure for the 2017 financial year was approximately US$554 million. During the June 2017 quarter, our operated rig count increased to five, as two additional rigs commenced operations in the Haynesville.

 

FY17

(FY16)

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

Capital expenditure(i)

   US$ billion      0.3 (0.8)        0.2 (0.4)        0.1 (0.0)        0.0 (0.0)        0.6 (1.2)  

Rig allocation

   At period end      1 (2)        1 (2)        3 (0)        0 (0)        5 (4)  

Net wells drilled and completed(ii)

   Period total      51 (89)        21 (30)        5 (5)        2 (11)        79 (136)  

Net productive wells

   At period end      963 (929)        126 (107)        394 (411)        1,044 (1,086)        2,527 (2,533)  

 

(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.

Onshore US capital expenditure is expected to be approximately US$1.2 billion in the 2018 financial year. Our plan considers up to five additional rigs.

 

  Evaluation of trials in the Black Hawk are expected to be completed in the September 2017 quarter and, subject to approval, one additional rig will commence toward the end of that quarter.

 

  One rig has recently commenced operations in the Hawkville executing a 14 well program that will include a mix of completion trials and acreage retention drilling.

 

  In the Permian, the current rig will focus on near-term lease obligations while an additional one to two rigs will continue to focus on completion trials that will inform a transition to full pad development as early as the 2019 financial year.

 

  One additional rig is expected to commence in the Haynesville in the September 2017 quarter. Further, our hedging strategy allows us to reduce price risk and secure average rates of return in excess of 20 per cent.

 

  At this point we do not anticipate any operated development in the Fayetteville, however we continue to work with joint venture partners to assess the potential of the Moorefield horizon through non-operated activity.

The divestment of non-core acreage for value is progressing, with the sale of a portion of the southern Hawkville anticipated to be executed in the September 2017 quarter. Our Fayetteville acreage is currently under review and we are considering all options including divestment.

Petroleum exploration

Exploration and appraisal wells drilled during the June 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        8,928 m        Drilling ahead  

The Wildling-2 well was spud on 15 April 2017 and drilling is in progress, with results expected in the September 2017 quarter. The Scimitar exploration well is expected to be spud in the September 2017 quarter.

In Mexico, BHP has commenced working in partnership with Pemex to plan and execute, during the next 24 months, the Minimum Work Program for blocks AE-0092 and AE-0093 consisting of one appraisal well, one exploration well and the acquisition of additional seismic data.

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

In the US Gulf of Mexico, BHP was the apparent high bidder on two leases adjacent to the Scimitar prospect (GC260 and GC304) in the Central Gulf of Mexico Lease Sale 247. BHP (28.32 per cent equity interest), with BP (Operator), was the apparent high bidder on two leases adjacent to the Mad Dog field (GC738 and GC870). All four leases were awarded by the Regulator during the June 2017 quarter.

 

 

BHP Operational Review for the year ended 30 June 2017    5


In Australia, BHP has completed its evaluation of the WA-480-P permit in the Northern Beagle sub-basin and has elected to exit this exploration permit. Acquisition of the seismic survey in the Exmouth sub-basin was completed on 1 May 2017. Processed data will be delivered during the June 2018 quarter.

Petroleum exploration expenditure for the 2017 financial year was US$805 million, of which US$473 million was expensed. We are pursuing high-quality oil plays in our priority basins and an US$840 million exploration program is planned for the 2018 financial year taking advantage of low rig rates. This program includes one well in the US Gulf of Mexico, three wells in Trinidad and Tobago, and one well in Mexico.

 

 

BHP Operational Review for the year ended 30 June 2017    6


Copper

Production

 

     FY17      Jun
2017
Qtr
     FY17
vs
FY16
    Jun Q17
vs
Jun Q16
    Jun Q17
vs
Mar Q17
 

Copper (kt)

     1,326        387        (16 %)      (6 %)      71

Zinc (t)

     87,502        29,076        58     349     41

Uranium oxide concentrate (t)

     3,661        737        (16 %)      (16 %)      (22 %) 

Copper – Total copper production for the 2017 financial year decreased by 16 per cent to 1.3 Mt. Total copper production is forecast to increase to between 1,655 and 1,790 kt in the 2018 financial year.

Escondida copper production for the 2017 financial year decreased by 21 per cent to 772 kt. The decrease was due to: a four day site-wide suspension of operations following a fatality in October 2016, 44 days of industrial action in the March 2017 quarter and severe weather in early June 2017, reducing production by 21 kt, 214 kt and 12 kt, respectively. Copper production of between 1,130 and 1,230 kt is expected in the 2018 financial year, supported by the ramp-up of the Los Colorados Extension project during the September 2017 quarter, enabling utilisation of three concentrators.

Pampa Norte copper production for the 2017 financial year increased by one per cent to 254 kt, supported by record cathode production and ore milled at Spence following the completion of the Recovery Optimisation project. Pampa Norte copper production for the 2018 financial year is expected to be higher than the prior year.

Olympic Dam copper production for the 2017 financial year decreased by 18 per cent to 166 kt following the state-wide power outage during September and October 2016 and unplanned maintenance at the refinery during December 2016 and January 2017. Copper production of 150 kt is expected in the 2018 financial year as a major smelter maintenance campaign is phased through August to November 2017, including a rebuild of the electric slag furnace, the flash furnace and the electro static precipitator. This is the largest maintenance program undertaken by BHP at Olympic Dam and on completion, the improved operational performance will underpin an expected increase in copper production to approximately 215 kt in the 2019 financial year. This will provide a stable base for the potential to increase capacity to 280 kt in the 2022 financial year.

Antamina copper production for the 2017 financial year decreased by nine per cent to 134 kt as record material mined was more than offset by lower copper grades as mining progressed through a zinc rich ore zone. Copper production is expected to decrease in the 2018 financial year to approximately 125 kt, as mining continues through a zinc rich ore zone consistent with the mine plan. Zinc production is expected to increase from 88 kt to approximately 100 kt in the 2018 financial year.

 

 

BHP Operational Review for the year ended 30 June 2017    7


Iron Ore

Production

 

     FY17      Jun
2017
Qtr
     FY17
vs
FY16
    Jun Q17
vs
Jun Q16
    Jun Q17
vs
Mar Q17
 

Iron ore(i) (kt)

     231,352        60,141        4     8     12

 

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

Iron ore – Total iron ore production for the 2017 financial year increased by four per cent to 231 Mt, or 268 Mt on a 100 per cent basis. WAIO production is expected to increase to between 239 and 243 Mt, or between 275 and 280 Mt on a 100 per cent basis, in the 2018 financial year. BHP will continue to work with the relevant authorities to obtain the necessary approvals to increase system capacity to 290 Mtpa (100 per cent basis).

Record annual production of 268 Mt (100 per cent basis) at WAIO reflects strong productivity improvements across the supply chain as well as the commissioning of a new primary crusher and additional conveying capacity at Jimblebar. Following recovery from the wet season, WAIO produced at a record annualised rate of 280 Mt (100 per cent basis) in the June 2017 quarter. The rail renewal and maintenance program was completed in May 2017.

In June 2017, BHP approved initial funding of US$184 million (BHP share) for the South Flank sustaining mine project. The initial funding will be used primarily for the expansion of accommodation facilities to support construction and future operational workforce requirements. The South Flank project, which will leverage and expand the existing Mining Area C hub, is BHP’s preferred option to replace production from the 80 Mtpa (100 per cent basis) Yandi mine when it reaches the end of its economic life in the early-to-mid 2020s. The project is expected to be submitted for Board approval in the middle of the 2018 calendar year and, if approved, first ore is targeted in the 2021 calendar year with ramp-up timed to coincide with the ramp-down of Yandi. The capital cost for South Flank is expected to be in the range of US$30 to US$40 per tonne, with expenditure fitting within WAIO’s previously indicated average annual sustaining capital expenditure of US$4 per tonne over the next five years.

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

 

 

BHP Operational Review for the year ended 30 June 2017    8


Coal

Production

 

     FY17      Jun
2017
Qtr
     FY17
vs
FY16
    Jun Q17
vs
Jun Q16
    Jun Q17
vs
Mar Q17
 

Metallurgical coal(i) (kt)

     39,770        8,494        (6 %)      (27 %)      (16 %) 

Energy coal(ii) (kt)

     29,135        8,186        7     30     10

 

(i) Represents Queensland Coal. Excludes production from Haju following the divestment of IndoMet Coal (2017 financial year: 129 kt).
(ii) Excludes production from New Mexico Coal following divestments (2017 financial year: 451 kt).

Metallurgical coal – Metallurgical coal production for the 2017 financial year decreased by six per cent to 40 Mt. Production is expected to increase to between 44 and 46 Mt in the 2018 financial year.

At Queensland Coal, production for the 2017 financial year was lower as a result of damage caused by Cyclone Debbie to the network infrastructure of rail track provider Aurizon. Mine operations recovered quickly after the cyclone, as dewatering infrastructure installed after the 2011 floods worked as designed. Force majeure was declared for all Queensland Coal products on 5 April 2017 and was lifted on 1 July 2017.

Despite the impacts of Cyclone Debbie, Peak Downs and Saraji achieved record annual production underpinned by improved stripping and mining performance, and utilisation of latent wash-plant capacity, including approximately 2 Mt trucked to Caval Ridge (100 per cent). Three additional mines were on track for record production prior to Cyclone Debbie.

The Caval Ridge Southern Circuit latent capacity 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 2017 financial year increased by seven per cent to 29 Mt. Production is expected to remain broadly unchanged at approximately 29 to 30 Mt in the 2018 financial year.

New South Wales Energy Coal production increased by six per cent as it benefitted from a lower strip ratio and additional bypass coal. Cerrejón production increased by nine per cent compared to the prior year, which was constrained by drought conditions.

 

 

BHP Operational Review for the year ended 30 June 2017    9


Other

Nickel production

 

     FY17      Jun
2017
Qtr
     FY17
vs
FY16
    Jun Q17
vs
Jun Q16
    Jun Q17
vs
Mar Q17
 

Nickel (kt)

     85.1        25.2        5     8     33

Nickel – Nickel West production for the 2017 financial year increased by five per cent to 85.1 kt. Debottlenecking activities at the Kwinana refinery have resulted in record refined metal production. 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 70% complete and within the approved budget. Shaft excavation is progressing.

Minerals exploration

Minerals exploration expenditure for the 2017 financial year was US$163 million, of which US$139 million was expensed. Greenfield minerals exploration is predominantly focused on advancing copper targets within Chile, Peru, Canada, South Australia and the South-West United States. BHP was awarded five exploration concessions in Ecuador in June 2017.

 

 

Variance analysis relates to the relative performance of BHP and/or its operations during the 2017 financial year compared with the 2016 financial year, 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, Haju (IndoMet Coal) and New Mexico Coal.
(2) Underlying EBITDA and Underlying attributable profit are used to reflect the underlying performance of BHP. Underlying EBITDA is earnings before net finance costs, taxation, depreciation, amortisation, impairment and any exceptional items. Underlying attributable profit is Attributable profit excluding any exceptional items.

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 year ended 30 June 2017    10


Further information on BHP can be found at: bhp.com

 

Media Relations

 

Australia and Asia

 

Ben Pratt

Tel: +61 3 9609 3672 Mobile: +61 419 968 734

Email: Ben.Pratt@bhpbilliton.com

 

Fiona Hadley

Tel: +61 3 9609 2211 Mobile: +61 427 777 908

Email: Fiona.Hadley@bhpbilliton.com

 

Amanda Saunders

Tel: +61 3 9609 3985 Mobile: +61 417 487 973

Email: Amanda.Saunders@bhpbilliton.com

 

Kester Hubbard

Tel: +61 7 3227 5671 Mobile: +61 408 727 261

Email: Kester.Hubbard@bhpbilliton.com

 

United Kingdom and South Africa

 

Neil Burrows

Tel: +44 20 7802 7484 Mobile: +44 7786 661 683

Email: Neil.Burrows@bhpbilliton.com

 

North America

 

Bronwyn Wilkinson

Mobile: +1 604 340 8753

Email: Bronwyn.Wilkinson@bhpbilliton.com

  

Investor Relations

 

Australia and Asia

 

Tara Dines

Tel: +61 3 9609 2222 Mobile: +61 499 249 005

Email: Tara.Dines@bhpbilliton.com

 

Andrew Gunn

Tel: +61 3 9609 3575 Mobile: +61 402 087 354

Email: Andrew.Gunn@bhpbilliton.com

 

United Kingdom and South Africa

 

Rob Clifford

Tel: +44 20 7802 4131 Mobile: +44 7788 308 844

Email: Rob.Clifford@bhpbilliton.com

 

Elisa Morniroli

Tel: +44 20 7802 7611 Mobile: +44 7825 926 646

Email: Elisa.Morniroli@bhpbilliton.com

 

Americas

 

James Wear

Tel: +1 713 993 3737 Mobile: +1 347 882 3011

Email: James.Wear@bhpbilliton.com

 

Cristian Coloma

Tel: +1 713 235 8902 Mobile: +1 346 234 8483

Email: Cristian.CA.Coloma@bhpbilliton.com

BHP Limited ABN 49 004 028 077

LEI WZE1WSENV6JSZFK0JC28

Registered in Australia

Registered Office: Level 18, 171 Collins Street

Melbourne Victoria 3000 Australia

Tel +61 1300 55 4757 Fax +61 3 9609 3015

  

BHP Plc Registration number 3196209

LEI 549300C116EOWV835768

Registered in England and Wales

Registered Office: Nova South, 160 Victoria Street

London SW1E 5LB United Kingdom

Tel +44 20 7802 4000 Fax +44 20 7802 4111

Members of the BHP Group which is

headquartered in Australia

 

LOGO

Follow us on social media

 

 

BHP Operational Review for the year ended 30 June 2017    11


Production summary  
    

BHP

interest

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

Petroleum (1)

                      

Petroleum

                      

Crude oil, condensate and NGL (Mboe)

                      

Onshore US

       9,469        8,288        8,143        9,439        8,501        34,371        48,181  

Conventional

       16,896        15,959        15,768        15,369        15,612        62,708        67,858  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       26,365        24,247        23,911        24,808        24,113        97,079        116,039  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Natural gas (bcf)

                      

Onshore US

       82.0        73.9        67.8        66.1        67.2        275.0        364.5  

Conventional

       95.7        107.8        97.1        88.4        99.5        392.8        380.2  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       177.7        181.7        164.9        154.5        166.7        667.8        744.7  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
                      
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum production (MMboe)

       56.0        54.5        51.4        50.6        51.9        208.4        240.1  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Copper (2)

                      

Copper

                      

Payable metal in concentrate (kt)

                      

Escondida (3)

     57.5     182.7        147.0        162.6        67.6        162.4        539.6        648.9  

Antamina

     33.8     38.7        34.1        32.0        29.2        38.5        133.8        146.4  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       221.4        181.1        194.6        96.8        200.9        673.4        795.3  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Cathode (kt)

                      

Escondida (3)

     57.5     85.3        70.5        71.5        27.2        62.8        232.0        330.3  

Pampa Norte (4)

     100     65.8        62.1        53.8        66.1        72.3        254.3        251.4  

Olympic Dam

     100     40.7        40.9        37.2        36.8        51.4        166.3        202.8  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       191.8        173.5        162.5        130.1        186.5        652.6        784.5  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
                      
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total copper (kt)

       413.2        354.6        357.1        226.9        387.4        1,326.0        1,579.8  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Lead

                      

Payable metal in concentrate (t)

                      

Antamina

     33.8     645        1,146        1,220        1,308        1,799        5,473        3,719  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       645        1,146        1,220        1,308        1,799        5,473        3,719  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Zinc

                      

Payable metal in concentrate (t)

                      

Antamina

     33.8     6,474        15,367        22,406        20,653        29,076        87,502        55,438  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       6,474        15,367        22,406        20,653        29,076        87,502        55,438  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Gold

                      

Payable metal in concentrate (troy oz)

                      

Escondida (3)

     57.5     35,894        27,561        37,784        11,572        33,941        110,858        108,996  

Olympic Dam (refined gold)

     100     20,010        24,366        29,651        21,941        28,188        104,146        117,686  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       55,904        51,927        67,435        33,513        62,129        215,004        226,682  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Silver

                      

Payable metal in concentrate (troy koz)

                      

Escondida (3)

     57.5     1,874        1,229        1,323        540        1,234        4,326        5,561  

Antamina

     33.8     1,558        1,345        1,446        1,301        1,691        5,783        6,711  

Olympic Dam (refined silver)

     100     232        163        188        174        243        768        917  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       3,664        2,737        2,957        2,015        3,168        10,877        13,189  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Uranium

                      

Payable metal in concentrate (t)

                      

Olympic Dam

     100     876        916        1,060        948        737        3,661        4,363  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       876        916        1,060        948        737        3,661        4,363  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Molybdenum

                      

Payable metal in concentrate (t)

                      

Antamina

     33.8     562        561        225        30        328        1,144        1,113  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       562        561        225        30        328        1,144        1,113  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

 

BHP Operational Review for the year ended 30 June 2017    12


Production summary  
    

BHP

interest

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

Iron Ore

                      

Iron Ore

                      

Production (kt) (5)

                      

Newman

     85     15,115        18,008        17,751        16,283        16,241        68,283        65,941  

Area C Joint Venture

     85     11,911        12,384        12,179        11,165        13,016        48,744        46,799  

Yandi Joint Venture

     85     18,325        15,729        17,555        14,656        17,415        65,355        67,375  

Jimblebar (6)

     85     5,304        6,057        5,178        4,824        5,891        21,950        18,890  

Wheelarra

     85     4,971        5,409        7,386        6,647        7,578        27,020        22,549  

Samarco

     50     —          —          —          —          —          —          5,404  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       55,626        57,587        60,049        53,575        60,141        231,352        226,958  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Coal

                      

Metallurgical coal

                      

Production (kt) (7)

                      

BMA

     50     9,225        8,384        8,684        7,996        6,394        31,458        33,413  

BHP Mitsui Coal (8)

     80     2,345        2,145        1,929        2,138        2,100        8,312        8,898  

Haju (9)

     75     260        102        27        —          —          129        529  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       11,830        10,631        10,640        10,134        8,494        39,899        42,840  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Energy coal

                      

Production (kt)

                      

USA

     100     632        451        —          —          —          451        7,052  

Australia

     100     3,991        3,952        3,851        4,662        5,711        18,176        17,101  

Colombia

     33.3     2,329        2,928        2,800        2,756        2,475        10,959        10,094  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       6,952        7,331        6,651        7,418        8,186        29,586        34,247  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Other

                      

Nickel

                      

Saleable production (kt)

                      

Nickel West

     100     23.4        18.8        22.1        19.0        25.2        85.1        80.7  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

       23.4        18.8        22.1        19.0        25.2        85.1        80.7  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

(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 year ended 30 June 2017    13


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

Petroleum (1)

                       

Bass Strait

                       

Crude oil and condensate

   (Mboe)      1,745        1,922        1,770        1,355        1,552        6,599        6,825  

NGL

   (Mboe)      1,831        2,102        1,460        1,236        1,661        6,459        6,684  

Natural gas

   (bcf)      38.1        41.9        31.3        28.7        37.4        139.3        131.0  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      9.9        11.0        8.4        7.4        9.4        36.3        35.3  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

North West Shelf

                       

Crude oil and condensate

   (Mboe)      925        1,486        1,468        1,239        1,314        5,507        4,834  

NGL

   (Mboe)      241        292        263        200        209        964        962  

Natural gas

   (bcf)      27.6        38.7        36.9        32.2        32.5        140.3        130.2  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      5.8        8.2        7.9        6.8        6.9        29.9        27.5  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Pyrenees

                       

Crude oil and condensate

   (Mboe)      2,097        1,676        1,726        1,509        1,606        6,517        8,617  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      2.1        1.7        1.7        1.5        1.6        6.5        8.6  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Other Australia (2)

                       

Crude oil and condensate

   (Mboe)      9        10        8        8        9        35        39  

Natural gas

   (bcf)      17.2        17.5        17.1        15.2        16.3        66.1        64.4  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      2.9        2.9        2.9        2.5        2.7        11.1        10.8  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Atlantis (3)

                       

Crude oil and condensate

   (Mboe)      4,058        3,054        3,263        3,881        3,637        13,835        16,008  

NGL

   (Mboe)      269        208        207        295        213        923        1,048  

Natural gas

   (bcf)      1.9        1.5        1.6        2.1        1.9        7.1        7.4  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      4.6        3.5        3.7        4.5        4.2        15.9        18.3  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Mad Dog (3)

                       

Crude oil and condensate

   (Mboe)      1,134        950        1,170        1,185        1,167        4,472        3,250  

NGL

   (Mboe)      52        36        52        59        68        215        157  

Natural gas

   (bcf)      0.2        0.1        0.2        0.2        0.2        0.7        0.5  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      1.2        1.0        1.3        1.3        1.3        4.8        3.5  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Shenzi (3)

                       

Crude oil and condensate

   (Mboe)      2,813        2,632        2,692        2,675        2,588        10,587        12,369  

NGL

   (Mboe)      192        94        131        161        179        565        903  

Natural gas

   (bcf)      0.6        0.5        0.5        0.5        0.6        2.1        2.7  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      3.1        2.8        2.9        2.9        2.9        11.5        13.7  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Eagle Ford (4)

                       

Crude oil and condensate

   (Mboe)      4,949        3,871        4,008        5,451        4,278        17,608        26,823  

NGL

   (Mboe)      2,717        2,268        2,159        2,354        2,240        9,021        13,971  

Natural gas

   (bcf)      19.5        16.5        15.2        17.0        15.1        63.8        95.8  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      10.9        8.9        8.7        10.6        9.0        37.3        56.8  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Permian (4)

                       

Crude oil and condensate

   (Mboe)      1,410        1,415        1,378        1,202        1,336        5,331        5,744  

NGL

   (Mboe)      393        734        580        428        646        2,388        1,642  

Natural gas

   (bcf)      4.9        4.4        4.4        4.0        6.2        19.0        14.6  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      2.6        2.9        2.7        2.3        3.0        10.9        9.8  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Haynesville (4)

                       

Crude oil and condensate

   (Mboe)      —          —          3        1        1        5        1  

NGL

   (Mboe)      —          —          15        3        —          18        —    

Natural gas

   (bcf)      31.1        28.2        24.0        22.0        21.4        95.6        136.6  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      5.2        4.7        4.0        3.7        3.6        16.0        22.8  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Fayetteville (4)

                       

Natural gas

   (bcf)      26.5        24.8        24.2        23.1        24.5        96.6        117.5  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      4.4        4.1        4.0        3.9        4.1        16.1        19.6  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

 

BHP Operational Review for the year ended 30 June 2017    14


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

Petroleum (1) (continued)

                       

Trinidad/Tobago

                       

Crude oil and condensate

   (Mboe)      162        140        156        127        139        562        709  

Natural gas

   (bcf)      8.6        6.4        8.4        8.4        9.4        32.6        31.0  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      1.6        1.2        1.6        1.5        1.7        6.0        5.9  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Other Americas (3) (5)

                       

Crude oil and condensate

   (Mboe)      308        275        269        257        238        1,039        1,363  

NGL

   (Mboe)      10        1        5        6        10        22        50  

Natural gas

   (bcf)      0.2        0.1        0.1        0.1        0.1        0.4        0.8  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      0.4        0.3        0.3        0.3        0.3        1.1        1.5  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

UK

                       

Crude oil and condensate

   (Mboe)      76        69        63        72        64        268        274  

NGL

   (Mboe)      10        22        49        32        16        119        43  

Natural gas

   (bcf)      1.3        1.1        1.0        1.0        1.1        4.2        4.3  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      0.3        0.3        0.3        0.3        0.3        1.1        1.0  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Algeria

                       

Crude oil and condensate

   (Mboe)      964        990        1,016        1,072        942        4,020        3,689  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      1.0        1.0        1.0        1.1        0.9        4.0        3.7  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Pakistan (6)

                       

Crude oil and condensate

   (Mboe)      —          —          —          —          —          —          42  

Natural gas

   (bcf)      —          —          —          —          —          —          7.9  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

   (MMboe)      —          —          —          —          —          —          1.4  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

BHP Petroleum

                       

Crude oil and condensate

                       

Onshore US

   (Mboe)      6,359        5,286        5,389        6,654        5,615        22,944        32,568  

Conventional (7)

   (Mboe)      14,291        13,204        13,601        13,380        13,256        53,441        58,011  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

   (Mboe)      20,650        18,490        18,990        20,034        18,871        76,385        90,579  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

NGL

                       

Onshore US

   (Mboe)      3,110        3,002        2,754        2,785        2,886        11,427        15,613  

Conventional

   (Mboe)      2,605        2,755        2,167        1,989        2,356        9,267        9,847  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

   (Mboe)      5,715        5,757        4,921        4,774        5,242        20,694        25,460  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Natural gas

                       

Onshore US

   (bcf)      82.0        73.9        67.8        66.1        67.2        275.0        364.5  

Conventional

   (bcf)      95.7        107.8        97.1        88.4        99.5        392.8        380.2  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

   (bcf)      177.7        181.7        164.9        154.5        166.7        667.8        744.7  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total petroleum products

                       

Onshore US

   (Mboe)      23,136        20,605        19,443        20,456        19,701        80,204        108,931  

Conventional (7)

   (Mboe)      32,846        33,926        31,951        30,102        32,195        128,175        131,225  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

   (Mboe)      55,982        54,530        51,394        50,558        51,896        208,379        240,156  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

(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.

(6)    BHP completed the sale of the Pakistan gas business on 31 December 2015.

(7)    September 2015 includes (8) Mboe for the finalisation adjustment following the cessation of production at Stybarrow on 26 June 2015.

     

     

     

     

     

     

     

 

 

BHP Operational Review for the year ended 30 June 2017    15


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

Copper

 

Metals production is payable metal unless otherwise stated.

 

Escondida, Chile (1)

                 

Material mined

   (kt)      108,037       106,504       90,863       26,045       93,389       316,801       433,274  

Sulphide ore milled

   (kt)      22,905       20,787       19,866       8,054       18,777       67,484       84,989  

Average copper grade

   (%)      0.94     0.87     1.02     1.01     1.07     0.99     0.98

Production ex mill

   (kt)      181.7       153.2       168.6       68.7       167.0       557.5       670.0  

Production

                 

Payable copper

   (kt)      182.7       147.0       162.6       67.6       162.4       539.6       648.9  

Copper cathode (EW)

   (kt)      85.3       70.5       71.5       27.2       62.8       232.0       330.3  

- Oxide leach

   (kt)      31.3       26.8       24.4       8.9       20.3       80.4       117.8  

- Sulphide leach

   (kt)      54.0       43.7       47.1       18.3       42.5       151.6       212.5  
     

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total copper

   (kt)      268.0       217.5       234.1       94.8       225.2       771.6       979.2  
     

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Payable gold concentrate

   (troy oz)      35,894       27,561       37,784       11,572       33,941       110,858       108,996  

Payable silver concentrate

   (troy koz)      1,874       1,229       1,323       540       1,234       4,326       5,561  

Sales

                 

Payable copper

   (kt)      186.6       134.9       172.7       63.7       163.3       534.6       649.7  

Copper cathode (EW)

   (kt)      83.8       65.6       71.8       39.4       56.0       232.8       329.0  

Payable gold concentrate

   (troy oz)      35,894       27,561       37,784       11,572       33,941       110,858       108,996  

Payable silver concentrate

   (troy koz)      1,874       1,229       1,323       540       1,234       4,326       5,561  

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

     

Pampa Norte, Chile

                 

Cerro Colorado

                 

Material mined

   (kt)      12,453       13,011       14,286       15,178       15,760       58,235       53,668  

Ore milled

   (kt)      4,375       3,241       3,342       4,179       4,411       15,173       17,946  

Average copper grade

   (%)      0.80     0.68     0.65     0.57     0.53     0.60     0.77

Production

                 

Copper cathode (EW)

   (kt)      24.8       17.1       12.1       16.7       18.8       64.7       77.3  

Sales

                 

Copper cathode (EW)

   (kt)      25.2       16.4       13.7       15.6       19.8       65.5       76.5  

Spence

                 

Material mined

   (kt)      21,124       23,638       22,635       22,939       24,230       93,442       88,188  

Ore milled

   (kt)      4,836       4,713       5,187       5,225       4,968       20,093       19,256  

Average copper grade

   (%)      1.22     1.17     1.19     1.09     1.13     1.14     1.33

Production

                 

Copper cathode (EW)

   (kt)      41.0       45.0       41.7       49.4       53.5       189.6       174.1  

Sales

                 

Copper cathode (EW)

   (kt)      40.9       41.2       41.5       49.0       55.7       187.4       173.6  

 

 

BHP Operational Review for the year ended 30 June 2017    16


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

Copper (continued)

                 

Metals production is payable metal unless otherwise stated.

 

Antamina, Peru

                 

Material mined (100%)

   (kt)      62,793       65,111       61,355       55,771       62,254       244,491       226,899  

Sulphide ore milled (100%)

   (kt)      14,711       13,522       13,399       11,955       13,229       52,105       55,609  

Average head grades

                 

- Copper(%)

        0.90     0.84     0.84     0.88     1.00     0.89     0.93

- Zinc(%)

        0.33     0.60     0.83     0.84     0.95     0.80     0.55

Production

                 

Payable copper

   (kt)      38.7       34.1       32.0       29.2       38.5       133.8       146.4  

Payable zinc

   (t)      6,474       15,367       22,406       20,653       29,076       87,502       55,438  

Payable silver

   (troy koz)      1,558       1,345       1,446       1,301       1,691       5,783       6,711  

Payable lead

   (t)      645       1,146       1,220       1,308       1,799       5,473       3,719  

Payable molybdenum

   (t)      562       561       225       30       328       1,144       1,113  

Sales

                 

Payable copper

   (kt)      42.4       32.8       33.0       30.2       36.9       132.9       145.4  

Payable zinc

   (t)      3,035       16,043       22,334       23,669       27,936       89,982       54,302  

Payable silver

   (troy koz)      2,055       1,277       1,388       1,304       1,513       5,482       6,956  

Payable lead

   (t)      1,108       767       1,100       1,475       1,493       4,835       3,503  

Payable molybdenum

   (t)      331       648       476       —         —         1,124       803  

Olympic Dam, Australia

                 

Material mined (1)

   (kt)      1,993       2,204       1,887       1,943       1,974       8,008       8,932  

Ore milled

   (kt)      2,031       2,279       2,116       2,112       2,097       8,604       9,699  

Average copper grade

   (%)      2.20     1.97     2.00     2.07     2.30     2.08     2.01

Average uranium grade

   (kg/t)      0.59       0.60       0.68       0.61       0.58       0.62       0.61  

Production

                 

Copper cathode (ER and EW)

   (kt)      40.7       40.9       37.2       36.8       51.4       166.3       202.8  

Uranium oxide concentrate

   (t)      876       916       1,060       948       737       3,661       4,363  

Refined gold

   (troy oz)      20,010       24,366       29,651       21,941       28,188       104,146       117,686  

Refined silver

   (troy koz)      232       163       188       174       243       768       917  

Sales

                 

Copper cathode (ER and EW)

   (kt)      43.9       37.5       41.2       33.5       51.5       163.7       203.1  

Uranium oxide concentrate

   (t)      778       1,085       883       839       1,298       4,105       3,729  

Refined gold

   (troy oz)      22,134       21,901       28,234       22,333       24,726       97,194       118,952  

Refined silver

   (troy koz)      201       184       203       108       251       746       877  

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

     

 

 

BHP Operational Review for the year ended 30 June 2017    17


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

Iron Ore

                       

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

 

Pilbara, Australia

                       

Production

                       

Newman

   (kt)      15,115        18,008        17,751        16,283        16,241        68,283        65,941  

Area C Joint Venture

   (kt)      11,911        12,384        12,179        11,165        13,016        48,744        46,799  

Yandi Joint Venture

   (kt)      18,325        15,729        17,555        14,656        17,415        65,355        67,375  

Jimblebar (1)

   (kt)      5,304        6,057        5,178        4,824        5,891        21,950        18,890  

Wheelarra

   (kt)      4,971        5,409        7,386        6,647        7,578        27,020        22,549  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total production

   (kt)      55,626        57,587        60,049        53,575        60,141        231,352        221,554  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total production (100%)

   (kt)      64,508        66,681        69,730        62,177        69,714        268,302        257,320  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Sales

                       

Lump

   (kt)      13,054        14,156        14,127        12,804        15,104        56,191        54,323  

Fines

   (kt)      42,673        42,278        45,447        41,043        46,249        175,017        167,255  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

   (kt)      55,727        56,434        59,574        53,847        61,353        231,208        221,578  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total sales (100%)

   (kt)      64,617        65,368        69,196        62,513        71,149        268,226        257,346  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

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

Samarco, Brazil (1)

                       

Production

   (kt)      —          —          —          —          —          —          5,404  

Sales

   (kt)      94        12        —          35        —          47        6,274  

(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 year ended 30 June 2017    18


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

Coal

                       

Coal production is reported on the basis of saleable product.

 

Queensland Coal

                       

Production (1)

                       

BMA

                       

Blackwater

   (kt)      2,206        1,981        1,855        1,694        1,766        7,296        7,626  

Goonyella

   (kt)      2,709        2,123        2,204        1,871        1,157        7,355        8,996  

Peak Downs

   (kt)      1,385        1,520        1,715        1,582        1,238        6,055        5,031  

Saraji

   (kt)      1,123        1,238        1,307        1,276        913        4,734        4,206  

Gregory Joint Venture (2)

   (kt)      —          —          —          —          —          —          1,329  

Daunia

   (kt)      684        646        680        674        560        2,560        2,624  

Caval Ridge

   (kt)      1,118        876        923        899        760        3,458        3,601  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total BMA

   (kt)      9,225        8,384        8,684        7,996        6,394        31,458        33,413  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

BHP Mitsui Coal (3)

                       

South Walker Creek

   (kt)      1,382        1,341        1,080        1,354        1,348        5,123        5,436  

Poitrel

   (kt)      963        804        849        784        752        3,189        3,462  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total BHP Mitsui Coal

   (kt)      2,345        2,145        1,929        2,138        2,100        8,312        8,898  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total Queensland Coal

   (kt)      11,570        10,529        10,613        10,134        8,494        39,770        42,311  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Sales

                       

Coking coal

   (kt)      8,059        7,240        7,658        7,133        5,496        27,527        30,064  

Weak coking coal

   (kt)      3,196        2,799        2,659        2,761        2,502        10,721        11,818  

Thermal coal

   (kt)      310        206        154        96        142        598        927  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

   (kt)      11,565        10,245        10,471        9,990        8,140        38,846        42,809  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

(1)    Production figures include some thermal coal.

(2)    Longwall mining at Crinum completed during the December 2015 quarter.

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

     

     

     

Haju, Indonesia (1)

                       

Production

   (kt)      260        102        27        —          —          129        529  

Sales - export

   (kt)      239        117        —          —          —          117        239  

(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)      632        451        —          —          —          451        3,999  

San Juan Coal (2)

   (kt)      —          —          —          —          —          —          3,053  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

   (kt)      632        451        —          —          —          451        7,052  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Sales thermal coal - local utility

        613        105        —          —          —          105        7,051  

(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)      3,991        3,952        3,851        4,662        5,711        18,176        17,101  

Sales

                       

Export thermal coal

   (kt)      3,993        3,640        3,539        4,407        4,913        16,499        16,614  

Inland thermal coal

   (kt)      440        331        311        431        327        1,400        1,156  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

   (kt)      4,433        3,971        3,850        4,838        5,240        17,899        17,770  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Cerrejón, Colombia

                       

Production

   (kt)      2,329        2,928        2,800        2,756        2,475        10,959        10,094  

Sales thermal coal - export(kt)

        2,844        2,905        2,722        2,613        2,803        11,043        10,601  

 

 

BHP Operational Review for the year ended 30 June 2017    19


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

Other

 

Nickel production is reported on the basis of saleable product

 

Nickel West, Australia

                       

Production

                       

Nickel contained in concentrate

   (kt)      0.3        0.3        0.2        0.2        —          0.7        1.5  

Nickel contained in finished matte

   (kt)      5.8        1.8        4.1        2.3        5.3        13.5        16.2  

Nickel metal

   (kt)      17.3        16.7        17.8        16.5        19.9        70.9        63.0  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total nickel production

   (kt)      23.4        18.8        22.1        19.0        25.2        85.1        80.7  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Sales

                       

Nickel contained in concentrate

   (kt)      0.3        0.3        0.2        0.2        —          0.7        1.5  

Nickel contained in finished matte

   (kt)      5.9        1.8        4.1        2.2        4.9        13.0        16.5  

Nickel metal

   (kt)      17.4        16.5        17.6        17.1        18.1        69.3        62.9  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total nickel sales

   (kt)      23.6        18.6        21.9        19.5        23.0        83.0        80.9  
     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

 

BHP Operational Review for the year ended 30 June 2017    20


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: July 19, 2017     By:  

/s/ Rachel Agnew

    Name:   Rachel Agnew
    Title:   Company Secretary