BHP pumps mORE

BHP’s third quarter production report is out and has it pumping like mad across divisions:

Iron ore – Total iron ore production for the September 2015 quarter increased by seven per cent to a record 61 Mt. Guidance for the 2016 financial year remains unchanged at 247 Mt. Western Australia Iron Ore (WAIO) production increased by eight per cent in the September 2015 quarter to a record 67 Mt (100 per cent basis), supported by the ramp-up of the Jimblebar mining hub and improved ore handling plant utilisation at Newman. WAIO also achieved record sales volumes of 67 Mt (100 per cent basis) as a result of an increase in direct to ship ore and continued optimisation of the port facilities. Production at WAIO is forecast to increase to 270 Mt (100 per cent basis) in the 2016 financial year with better productivity the sole source of volume growth. Work has commenced on the installation of a new primary crusher and additional conveying capacity at Jimblebar, and associated costs are included within WAIO’s average annual sustaining capital expenditure of approximately US$5 per tonne. The ramp-up of additional capacity at the Jimblebar mining hub along with further productivity improvements, will deliver an increase in system capacity to 290 Mtpa over time. Samarco production for the September 2015 quarter increased by nine per cent to 7.5 Mt (100 per cent basis) underpinned by the ramp-up of the fourth pellet plant to full capacity during the March 2015 quarter.

Everything was more or less ahead of expectations on iron ore. Like RIO, BHP appears positioned to leap frog its own production guidance next year if it chooses. It is already shipping at 270mt per annum and has more efficiencies ahead.