BHP Billiton production mostly down

20th Jul 2016 07:27

(ShareCast News) - Miner BHP Billiton posted its operational review for the year to 30 June on Wednesday, confirming it exceeded full-year production guidance for petroleum, copper and metallurgical coal, and achieved record full-year production at Western Australia Iron Ore.The FTSE 100 firm said it expects to achieve full-year cost guidance at its major assets, with unit costs forecast to decline further next year.Petroleum production declined 6% to 240 MMboe, copper dropped 8% to 1,580 kt, iron ore was down 2% to 227 Mt, metallurgical coal improved by 1% to 43 Mt, and energy coal production was down 16% to 34 Mt.In petroleum, exploration drilling commenced in Trinidad and Tobago and in the Gulf of Mexico, following positive results at Shenzi North during the year.The Los Colorados Extension project was also approved by the Escondida Owners Council with first production expected in the second half of the 2017 financial year.BHP's board said four major projects remained underway and are "tracking to plan".Underlying attributable profit in the June 2016 half-year is expected to include additional charges of up to $175m, the company warned."Over the next 12 months, we expect volumes and costs across our minerals businesses to benefit from our continued drive to safely improve productivity," said chief executive Andrew Mackenzie."We can create significant value through further cost reductions, taking advantage of latent capacity in our assets and investing in low-capital projects."These initiatives are expected to grow production by five per cent in copper, up to four per cent in iron ore and three per cent in metallurgical coal in the next financial year," Mackenzie added.He said that in petroleum, the company has delivered strong performance from its conventional assets and responded to market conditions by reducing the number of rigs in its onshore US assets as it focuses on cash flow and value."We have taken advantage of the fall in deep water drilling costs and accelerated our conventional oil exploration program to simultaneously run campaigns in the Gulf of Mexico and the Caribbean."We are well positioned to bring on shale volumes as markets tighten and develop conventional resources over the medium to long term," Mackenzie explained.