【Ferro-alloys.com】Major BHP has lowered its full-year production expectations for its copper and nickel divisions, while warning of tight labour markers in Australia and Chile for the rest of the year.

“BHP delivered safe and reliable production in the third quarter. Our Western Australian iron-ore business continues to perform strongly as we navigate the state’s first major Covid-19 wave, and we remain on track to achieve full-year volume and cost guidance. Amid record-high prices, our Queensland metallurgical coal business delivered strong underlying performance and benefited from better weather in the quarter,” said CEO Mike Henry on Thursday.

“In copper, Spence production is increasing and the Olympic Dam smelter is performing strongly as it returns to full production following planned maintenance. These gains have been more than offset at Escondida by impacts from Covid-19 and public road blockades in Antofagasta, which are reflected in a revision to overall production guidance.

“Our Jansen potash project is on track, with good progress on the shafts, in the underground mining systems and at the port. The merger of our petroleum assets with Woodside has progressed and is set for completion in June 2022, while the divestment of our BMC business to Stanmore should complete in May 2022.

“Market volatility and inflationary pressures have increased further as a result of the Russian invasion of Ukraine. We continue our work to mitigate cost pressures through a sharp focus on operational reliability and cost discipline. While we expect conditions to improve during the course of the 2023 calendar year, we anticipate the skills shortages and overall labour market tightness in Australia and Chile to continue in the period ahead,” Henry said.

BHP reported iron-ore production of 59.7-million tonnes in the March quarter, down 10% on the December quarter, while production in the nine months under review reached 189.1-million tonnes, on par with the previous corresponding period.

The lower iron-ore production volumes reflected temporary labour constraints owing to the Covid-19 pandemic, as well as train driver shortages and planned maintenance activities. This was partly offset by record production from the MAC hub, with the continued ramp-up of the South Flank operations.

Iron-ore production guidance for the full year has remained unchanged at between 249-million and 259-million tonnes for the full year.

Meanwhile, copper production in the March quarter was up 1% on the December quarter, to 369 700 t, but for the nine months under review was down 10% on the previous corresponding period, to 1.11-million tonnes.

BHP noted that higher volumes from the Olympic Dam operation, following the completion of a planned smelter maintenance campaign, were partly offset by lower volumes at the Escondida operations, mainly owing to Covid-19 workforce impacts and public road blockages as a result of social unrest.

BHP has lowered its full-year copper production expectations from between 1.59-million tonnes and 1.76-million tonnes, to between 1.57-million tonnes and 1.62-million tonnes.

Nickel production in the March quarter reached 18 700 t, down 13% on the December quarter, with year-to-date production down 13% on the previous corresponding period, to 58 000 t.

The lower production volumes reflected temporary labour constraints owing to the Covid-19 pandemic, the miner told shareholders.

For the full year, nickel production expectations have been lowered from between 85 000 t and 95 000 t, to between 80 000 t and 85 000 t.

Meanwhile, metallurgical coal production in the three months under review reached 10.6-million tonnes, up 20% on the December quarter, while production in the nine months under review was down 2% on the previous corresponding period, to 28.2-million tonnes.

The increased production volumes during the quarter came as a result of lower rainfall than the prior quarter, coupled with a strong operational performance driven by improved truck productivity.

Energy coal production in the quarter declined by 13%, to 2.6-million tonnes, and by 1% in the nine months under review, to 9.8-million tonnes, with the lower volumes attributed to continued wet weather and Covid-19 related absenteeism impacting stripping and mining productivity, as well as an increased proportion of higher quality products.

The forecast for metallurgical coal production in the full year has remained unchanged at between 38-million and 41-million tonnes, while energy coal production forecasts have also remained unchanged at between 13-million and 15-million tonnes.

Meanwhile, BHP’s discontinued petroleum operations delivered 24.1-million barrels of oil equivalent during the quarter, down 6% on the December quarter, while year-to-date production was up 2% on the previous corresponding period, to 77.3-million barrels of oil equivalent.

Completion of the proposed merger of BHP’s oil and gas portfolio with Woodside Petroleum is targeted for June 1, subject to the satisfaction of conditions precedent including approval by Woodside shareholders at the Woodside general meeting on May 19. 

• [Editor:zhaozihao]