BHP Billiton tips 5 pct rise in 2013 iron ore output
BHP Billiton posted strong growth in iron ore production in the June quarter and said it expects to lift Australian iron ore output by 5 percent in the 2013 financial year, despite risks from cooling demand in top customer China, Reuters reports.
In its biggest division, BHP reported on Wednesday a 15 percent rise in iron ore output to 40.9 million tonnes in the quarter from a year earlier, taking it to a record annual output of 159 million tonnes.
Thanks to the expansion of railway lines and the addition of new ship loading capacity, BHP was producing at a rate of 179 million tonnes a year in the June quarter, putting it on track to reach a target rate of 220 million tonnes a year in 2014.
BHP, the world no.3 iron ore miner behind Brazil's Vale and Rio Tinto, is due to decide by December whether to go ahead with the first stage of what could eventually be a $20 billion expansion to nearly double its iron ore capacity in Western Australia beyond 2014.
Rio Tinto reported flat quarterly iron ore output on Tuesday, while smaller rival Fortescue Metals Group reported a 54 percent jump in production from a year earlier, on track to reach 155 million tonnes a year by mid-2013, just behind BHP.
Output of coking coal, a key source of revenue, was the least predictable among the top global miner's products in the final quarter of its financial year, with production hampered by rain and striking workers fighting an 18-month battle over pay and conditions.
BHP also reported a 10 percent rise in onshore U.S. oil production and said more than 80 percent of its onshore drilling activity was focused on the liquids rich parts of the Eagle Ford shale and Permian Basin at the end of the quarter.
The onshore oil production is being closely watched due to concerns in the market that BHP badly timed its $17 billion acquisition of U.S. shale gas assets last year, spawning fears of a writedown of at least $3 billion when it reports annual results in August.
The increased focus on drilling for oil rather than gas from the shale acreage could lead analysts to pare their views on the scale of the writedown.
Copper production rose 15 percent to 312,500 tonnes in the final quarter of BHP's financial year from a year earlier and compared with a forecast of 311,200 tonnes from UBS.
BHP had flagged annual output would be shored up by a strong increase in the fourth quarter from the Escondida mine in Chile.