BHP releases quarterly update; slashes FY19 iron production guidance

  • Apr 17, 2019 AEST
  • Team Kalkine
BHP releases quarterly update; slashes FY19 iron production guidance

BHP Group Limited (ASX: BHP), a subsidiary of BHP Group and headquartered in Melbourne, Australia, discovers, acquires, develops, and markets natural resources worldwide. It primarily explores for Petroleum, Copper, Iron Ore, and Coal. On April 17th, 2019, the company released its Quarterly Activities Report for the three months ended March 31st, 2019 (Mar Q19). The results demonstrate strong operational performance for the period amidst adverse weather impacts across Chile and Australia.

As per the production figures, the company recorded 92 MMboe of petroleum for the nine months to March 2019 (Mar YTD19) and 29 Mmboe for Mar Q19, down 5% on the prior quarter ended December 2018 (Dec Q18). The weak seasonal gas sales at Bass Strait were partly balanced by higher production at Trinidad and Tobago post their maintenance in Dec Q18.

The copper production stood at 1,245 kt for Mar YTD19 and 420 kt for Mar Q19 (up 1% on Dec Q18), on account of improved production from Olympic Dam as surface operations were reinstated to full capacity after the acid plant outage in August 2018.

Meanwhile, the volumes of Iron ore production at Western Australia Iron Ore (WAIO) reflected the impact of Tropical Cyclone Veronica bringing down the production by 3% to 56 Mt at the end of Mar Q19.

Although Queensland Coal delivered a strong underlying operating performance, the wet weather turned it around causing the metallurgical coal production to fall by 4% to 10 Mt in Mar Q19. Besides, the increased production of energy coal at New South Wales Energy Coal (NSWEC) was also counteracted by the adverse weather at Cerrejón resulting in 7 Mt for Mar Q19 (up 1% on Dec Q18).

According to BHP Group, around five major projects are underway for copper, iron ore, petroleum and potash with a total budget of USD 11.1 billion. In Petroleum, around USD 696 million (BHP share) in capital expenditure for the Atlantis Phase 3 project in the US Gulf of Mexico was approved and the Bélé-1 exploration well in Trinidad and Tobago encountered hydrocarbons (drilling still in progress) during the quarter.

During the nine months ended March 2019, the total exploration expenditure for minerals amounted to around USD 122 million, of which USD 84 million was expensed.

In March 2019, BHP also signed a non-binding letter of intent (LoI) with Luminex, for an earn-in and joint venture agreement, expected to be closed within next two months, on Luminex’s Tarqui 1 and 2 mining concessions located in Ecuador. Of Late, on April 15th, 2019, BHP obtained a 5% interest in Midland Exploration Inc., which owns tenements with copper deposits in Canada.

Going further, the production guidance for the financial year 2019 remains as prescribed for all minerals but reduced to 265 Mt -270 Mt for Iron ore due to the Tropical Cyclone Veronica. Besides, the full year unit costs for Petroleum, Escondida and Queensland Coal are also expected to be in accord with guidance but for Iron ore, it is now below USD 15 per tonne.

The Group’s current market cap stands at AUD 115.98 billion with ~ 2.95 billion outstanding shares. On April 17th, 2019, the BHP stock price is trending at AUD 38.520, down 2.16% with a positive YTD return of 21.92%.


This website is a service of Kalkine Media Pty. Ltd. A.C.N. 629 651 672. The website has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. Kalkine Media does not in any way endorse or recommend individuals, products or services that may be discussed on this site. Our publications are NOT a solicitation or recommendation to buy, sell or hold. We are neither licensed nor qualified to provide investment advice.


All pictures are copyright to their respective owner(s) does not claim ownership of any of the pictures displayed on this website unless stated otherwise. Some of the images used on this website are taken from the web and are believed to be in public domain. We have used reasonable efforts to accredit the source (public domain/CC0 status) to where it was found and indicated it below the image.


There is no investor left unperturbed with the ongoing trade conflicts between US-China and the devastating bushfire in Australia.

Are you wondering if the year 2020 might not have taken the right start? Dividend stocks could be the answer to that question.

As interest rates in Australia are already at record low levels, find out which dividend stocks are viewed as the most attractive investment opportunity in the current scenario in our report.

We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it. OK