BHP Billiton PLC BLT Exploration and Development Report 30 Sept 2012

  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
Number       26/12


                   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.

                 Share of
                 approved Initial
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.
Bass Strait
(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.
                                                                 On budget.
                                                                 Steady state
North West Shelf                                                 production
North Rankin B                                                   remains on
Gas Compression                                                  track for
(Australia)                                                      CY13. The
16.67%                                                           overall
                                      2,500 million cubic feet   project is
Non operator LNG      850 CY13        gas per day.               96% complete.
North West Shelf
Greater Western



16.67%                                                           On schedule
                                                                 and budget.
Non operator                          To maintain LNG plant      The overall
                                      throughput from the North  project is
LNG                   400 CY16        West Shelf operations.     26% complete.
Organic Growth
Project 1

(Chile)                                                          On schedule
                                                                 and budget.
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.
Escondida Oxide
Leach Area
Project                                                          On schedule
                                                                 and budget.
(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.
Blending and
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.
                                                                 On schedule
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.
Broadmeadow Life
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.
Caval Ridge

                                      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.
Newcastle Third
Port Project
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.

Minerals exploration

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

Petroleum exploration

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.

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MSCFFIEFMFESEES -0- Oct/17/2012 06:00 GMT
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