BHP Billiton PLC (BLT) - Exploration and Development Report 30 Sept 2012
RNS Number : 8490O
BHP Billiton PLC
16 October 2012
Release Time IMMEDIATE
Date 17 October 2012
BHP BILLITON EXPLORATION AND DEVELOPMENT REPORT
FOR THE QUARTER ENDED 30 SEPTEMBER 2012
This report covers the Group's exploration and development activities for the
September 2012 quarter. Unless otherwise stated, BHP Billiton's interest in
the projects referred to in this report is 100 per cent and references to
project schedules are based on calendar years.
BHP Billiton remains committed to its proven strategy which is to invest in
large, long life, low cost, expandable, upstream assets, diversified by
commodity, geography and market, throughout the economic cycle. In that
regard, the Group has 19 high quality, low risk, largely brownfield projects
currently in execution that are expected to deliver strong financial returns
for our shareholders. The majority of these projects are scheduled to achieve
first production before the end of the 2015 financial year which will support
strong growth in our major, high margin businesses. With capital and
exploration expenditure of US$22.0 billion forecast for the Group in the 2013
financial year, we are fully committed and no major project approvals are
anticipated over this timeframe.
In response to the more challenging external environment, during the September
2012 quarter BHP Billiton decided not to proceed with the 2.5 million tonnes
per annum (100 per cent basis) expansion of Peak Downs that is associated with
the Caval Ridge mine development (Australia). Importantly, the 5.5 million
tonnes per annum (100 per cent basis) Caval Ridge mine remains on schedule to
deliver first production in the 2014 calendar year while the valuable Peak
Downs expansion option remains embedded within the portfolio.
The Bass Strait Kipper gas field (Australia) offshore production facilities
were completed in the September 2012 quarter and are ready to commence
production pending resolution of the mercury content. The Bass Strait Kipper
project will not be reported in future Exploration and Development Reports.
BHP Billiton's Onshore US drilling and development expenditure totalled US$1.0
billion in the September 2012 quarter. Our guidance for Onshore US drilling
and development expenditure for the 2013 financial year remains unchanged at
US$4.0 billion. Over 80 per cent of this expenditure will be focused on the
liquids rich Eagle Ford shale and Permian Basin.
Project and capex production Quarterly
ownership (US$m) target date Production capacity (100%) progress
Macedon On schedule
(Australia) and budget.
71.43% The overall
200 million cubic feet gas project is
Operator Gas 1,050 CY13 per day. 80% complete.
(Australia) The offshore
32.5% - 50% 10,000 bpd condensate and production
processing capacity of 80 facilities
Non operator million cubic feet gas per are 100%
Gas/Gas Liquids 900 CY12(a) day. complete.
Bass Strait On revised
Turrum schedule and
(Australia) 50% 11,000 bpd condensate and budget. The
processing capacity of 200 overall
Non operator million cubic feet gas per project is
Gas/Gas Liquids 1,350 CY13 day. 81% complete.
North West Shelf production
North Rankin B remains on
Gas Compression track for
(Australia) CY13. The
2,500 million cubic feet project is
Non operator LNG 850 CY13 gas per day. 96% complete.
North West Shelf
16.67% On schedule
Non operator To maintain LNG plant The overall
throughput from the North project is
LNG 400 CY16 West Shelf operations. 26% complete.
(Chile) On schedule
57.5% Replaces the Los Colorados The overall
concentrator with a new project is
Copper 2,207 H1 CY15 152,000 tpd plant. 17% complete.
Project On schedule
(Chile) The overall
New dynamic leaching pad project is
57.5% and mineral handling 20% complete.
system. Maintains oxide
Copper 414 H1 CY14 leaching capacity.
EKATI Misery On schedule
Open Pit Project Project consists of a and budget.
(Canada) 80% pushback of the existing The overall
Misery open pit which was project is
Diamonds 323 CY15 mined from 2001 to 2005. 30% complete.
Increases mining and
processing capacity to
WAIO Jimblebar 35milliontpa with On schedule
Mine Expansion incremental and budget.
(Australia) 96% debottlenecking The overall
opportunities to project is
Iron Ore 3,300(b) Q1 CY14 55milliontpa. 52% complete.
Hedland Inner Increases total inner
Harbour harbour capacity to On schedule
Expansion 220milliontpa with and budget.
(Australia) 85% debottlenecking The overall
opportunities to project is
Iron Ore 1,900(b) H2 CY12 240milliontpa. 69% complete.
Rail Yard On schedule
Facilities and budget.
(Australia) 85% Optimises resource and The overall
enhances efficiency across project is
Iron Ore 1,400(b) H2 CY14 the WAIO supply chain. 32% complete.
WAIO Orebody 24 Maintains iron ore and budget.
(Australia) 85% production output from the The overall
Newman Joint Venture project is
Iron Ore 698 H2 CY12 operations. 45% complete.
Samarco Fourth On schedule
Pellet Plant Increases iron ore pellet and budget.
(Brazil) 50% production capacity by The overall
8.3milliontpa to project is
Iron Ore 1,750 H1 CY14 30.5milliontpa. 59% complete.
Daunia Greenfield mine On schedule
(Australia) 50% development with capacity and budget.
to produce 4.5milliontpa The overall
Metallurgical of export metallurgical project is
Coal 800 CY13 coal. 68% complete.
Extension Increases productive On schedule
(Australia) 50% capacity by and budget.
0.4milliontpa and The overall
Metallurgical extends life of the mine project is
Coal 450 CY13 by 21 years. 83% complete.
Hay Point Stage On schedule
Three Expansion Increases port capacity and budget.
(Australia) 50% from 44 million tpa to The overall
Metallurgical 55milliontpa and reduces project is
Coal 1,250(b) CY14 storm vulnerability. 50% complete.
Greenfield mine On schedule
50% development to produce an and budget.
initial 5.5 million tpa of The overall
Metallurgical export metallurgical project is
Coal 1,870(b) CY14 coal(c). 48% complete.
Appin Area 9
(Australia) Maintains Illawarra Coal's
production capacity with a On schedule
100% replacement mining domain and budget.
and capacity to produce The overall
Metallurgical 3.5 million tpa of project is
Coal 845 CY16 metallurgical coal. 25% complete.
Increases saleable thermal On schedule
Cerrejon P40 coal production by and budget.
Project 8milliontpa to The overall
(Colombia) 33.3% approximately project is
Energy Coal 437 CY13 40milliontpa. 47% complete.
Stage 3 On schedule
(Australia) Increases total coal and budget.
35.5% terminal capacity from The overall
53milliontpa to project is
Energy Coal 367 CY14 66milliontpa. 52% complete.
Greenfield minerals exploration is currently focused on advancing copper
targets within Chile and Peru. Minerals exploration expenditure for the
September 2012 quarter was US$199 million, of which US$144 million was
Exploration and appraisal wells drilled during the quarter or in the process
of drilling as at 30 September 2012.
Well Location BHP Billiton equity Status
Gulf of Mexico 44%
Atlantis East DC 211 (BP operator) Drilling ahead
Gulf of Mexico 11.2% Temporarily abandoned
Gunflint-3 MC948 (Noble operator) Under evaluation
Gulf of Mexico 50%
Ness Deep GC507 (Operator) Drilling ahead
Petroleum exploration expenditure for the September 2012 quarter was US$173
million, of which US$80 million was expensed. Petroleum exploration
expenditure of approximately US$775 million is anticipated in the 2013
financial year with the majority of activity to occur in the Gulf of Mexico.
This report, together with the Production Report, represents the Interim
Management Statement for the purposes of the UK Listing Authority's Disclosure
and Transparency Rules. There have been no significant changes in the
financial position of the Group in the quarter ended 30 September 2012.
(a) The Bass Strait Kipper gas field offshore production facilities were
completed in the September 2012 quarter and are ready to commence production
pending resolution of the mercury content. The project to remove this mercury
is being managed on a stand-alone basis.
(b) Excludes announced pre-commitment funding.
(c) The 2.5 million tonnes per annum (100 per cent basis) expansion of Peak
Downs is no longer included in the project scope.
Further information on BHP Billiton can be found at: www.bhpbilliton.com
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