Wrap Text
Quarterly Activities Report
BHP Group Limited
BHP Group Limited ABN 49 004 028 077
Registered in Australia
Registered Office: Level 18, 171 Collins Street Melbourne VIC 3000
Share code: BHG
ISIN: AU000000BHP4
NEWS RELEASE
Release Time IMMEDIATE
Date 20 July 2023
Release Number 13/23
BHP OPERATIONAL REVIEW
FOR THE YEAR ENDED 30 JUNE 2023
. There were two fatalities during the financial year. We are committed to
sharing the learnings from these tragic events and remain resolute in our
commitment to eliminating fatalities and serious injuries at BHP.
. Full year production was guidance achieved for copper, iron ore, metallurgical
coal and energy coal. Nickel achieved revised guidance and finished in line
with the lower end of original guidance.
. Annual production records at Western Australia Iron Ore (WAIO) of 285 Mt (100% basis), Spence of 240 kt,
and Olympic Dam for both copper of 212 kt and refined gold of 186 troy koz.
. Full year unit cost guidance/1/ is expected to be achieved at Escondida,
WAIO and New South Wales Energy Coal (NSWEC). BHP Mitsubishi Alliance (BMA) is expected to be
marginally above its revised guidance range.
. Average realised prices for copper, iron ore and metallurgical coal
products were lower in the 2023 financial year compared to the prior year.
Nickel prices remained stable, while thermal coal prices were stronger,
predominantly in the first half.
. BHP completed the acquisition of OZ Minerals Ltd (OZL) on 2 May 2023/2/.
. BHP has continued to make strong progress at Oak Dam in South Australia. We
have defined an Exploration Target/3/ and plan to increase the number of
exploration drills from nine to eleven by the end of the 2023 calendar year.
. In Australia, BHP released its sixth Reconciliation Action Plan, which was
awarded Elevate status.
BHP Chief Executive Officer, Mike Henry:
"The financial year was marked by the deaths of Jody Byrne and Nathan Scholz.
These tragic events underscore the absolute importance of safety and we are
resolute in our commitment to eliminating fatalities and serious injuries at
BHP.
"BHP finished the year with a strong fourth quarter, increasing annual
production across the board and achieving annual records at WAIO, Olympic
Dam and Spence. WAIO shipped record volumes on the back of productivity in its
supply chain, rail network and car dumpers, while South Flank completed its
deployment of autonomous haul trucks in May and is on track to ramp up to full
production in the next 12 months. Olympic Dam's improved reliability and
productivity delivered record annual output in copper, gold and silver, and the
integration of OZ Minerals into our South Australian copper business is expected
to lift production to between 310 and 340 kt in FY24. At Escondida, the team
managed through operational challenges to deliver solid production and position
the asset to increase output further in FY24. Our Queensland coal operations
achieved strong underlying performance including the transition to autonomous
fleets at Goonyella Riverside and Daunia, offsetting the impact of significant
wet weather.
"Inflationary pressures impacted our business in the year, and we remain laser
focused on safety and productivity to remain competitive. Competitiveness will
be ever more important as we enter the new financial year and at a time when
there are new challenges and opportunities to resource development and global
economic volatility.
"BHP's portfolio is geared towards high quality steelmaking and growth options
in future facing commodities. The Jansen potash project in Canada remains ahead
of plan and studies for Stage 2 are progressing. Through the year, BHP made
strategic investments and exploration progress in copper and nickel prospects
globally, including Kabanga in Tanzania, Oak Dam in Australia, Filo Mining with
the Filo del Sol project in Argentina and Chile, and Ocelot in the United States,
as well as Serbia and Peru."
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BHP Operational Review for the 1
year ended 30 June 2023
Summary
Operational performance
Production and guidance are summarised below.
FY23 Jun Q23 Jun Q23
Jun vs vs vs FY24 FY24e
Production FY23 Q23 FY22 Jun Q22 Mar Q23 guidance vs FY23
---------- ------- ----- ---- ------- ------- ----------------- -------------
Copper (kt) /i/....................... 1,716.5 476.2 9% 3% 17% 1,720 - 1,910 0% - 11%
Escondida (kt)..................... 1055.3 293.0 5% 1% 16% 1,080 - 1,180 2% - 12%
Pampa Norte (kt)................... 288.8 68.5 3% (11%) (6%) 210 - 250/ii/ (27%) - (13%)
Copper South Australia (kt) /iii/.. 232.4 76.6 68% 38% 48% 310 - 340 33% - 46%
Antamina (kt)...................... 138.4 36.5 (8%) (8%) 23% 120 - 140 (13%) - 1%
Carajas (kt)....................... 1.6 1.6 -- -- -- -- --
Iron ore (Mt)......................... 257.0 65.3 1% 2% 9% 254 - 264.5 (1%) - 3%
WAIO (Mt).......................... 252.5 64.1 1% 1% 9% 250 - 260 (1%) - 3%
WAIO (100% basis) (Mt)............. 285.3 72.7 1% 1% 10% 282 - 294 (1%) - 3%
Samarco (Mt)....................... 4.5 1.2 11% 22% 17% 4 - 4.5 (11%) - 0%
Metallurgical coal - BMA (Mt)......... 29.0 8.5 0% 4% 22% 28 - 31 (4%) - 7%
BMA (100% basis) (Mt).............. 58.0 17.0 0% 4% 22% 56 - 62 (4%) - 7%
Energy coal - NSWEC (Mt).............. 14.2 4.8 3% 22% 21% 13 - 15 (8%) - 6%
Nickel (kt)........................... 80.0 22.0 4% 17% 12% 77 - 87 (4%) - 9%
i. Includes contribution of 21.5 kt from operations acquired from OZL/2/.
ii. Production guidance for FY24 is provided for Spence only. Cerro Colorado is
expected to produce ~9 kt as it transitions to closure by 31 December 2023.
iii. Comprised of Olympic Dam, Prominent Hill and Carrapateena. Refer to the production
and sales report for more details.
FY23 Jun Q23
Production (vs FY22) (vs Mar Q23) Jun Q23 vs Mar Q23 commentary
---------- --------- ------------ -----------------------------
Copper (kt) .................... 1,716.5 476.2 Higher concentrate volumes at Escondida reflect the higher concentrate
9% 17% feed grade of 0.93 per cent, and higher volumes at Copper South Australia
resulted in a BHP record for quarterly production from the refinery at
Olympic Dam, and reflect the addition of Prominent Hill and Carrapateena.
Iron ore (Mt) .................. 257.0 65.3 Increased production at WAIO, despite unfavourable impacts from Tropical
1% 9% Cyclone Ilsa, due to strong supply chain performance and the prior period
impacts from the temporary shutdown of operations following the fatality,
as well as the tie-in activity of the Port Debottlenecking Project 1 (PDP1).
Metallurgical coal (Mt) ........ 29.0 8.5 Increased production driven by increased yield, improved truck productivity
0% 22% and favourable weather conditions, partially offset by the commencement of
a second longwall move at Broadmeadow.
Energy coal (Mt) ............... 14.2 4.8 Higher volumes as a result of additional stripping volumes, decreased
3% 21% proportion of washed coal, favourable weather conditions, and improvement
in truck productivity with record quarterly annualised truck hours.
Nickel (kt) .................... 80.0 22.0 Higher volumes due to improved mining performance at Mt Keith, increased
4% 12% third party purchases and inventory drawdowns enabling increased
concentrate production, partially offset by a heavy rain event in
April 2023.
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BHP Operational Review for the 2
year ended 30 June 2023
Summary of disclosures
BHP expects its financial results for the second half of the 2023 financial year
to reflect certain items summarised in the table below. The table does not
provide a comprehensive list of all items impacting the period. The financial
statements are the subject of ongoing work that will not be finalised until the
release of the financial results on 22 August 2023. Accordingly, the table below
contains preliminary information that is subject to update and finalisation.
H2 FY23
impact
Description US$M/i/ Classification/ii/
-----------------------------------------------------------------------------------------------------------------------------------
For the 2023 financial year, unit costs at Escondida and WAIO are expected to -- (Up Arrow) Operating costs
be towards the upper end of guidance ranges, and unit costs at NSWEC are
expected to be in line with the revised guidance range (at guidance exchange rates)
Unit costs at BMA are expected to be marginally above the revised guidance
range (at guidance exchange rates)
Note: Australian dollar and Chilean peso were weaker than guidance rates in
the period/iii/
Unit costs will not include any costs relating to the review of employee
entitlements and allowances.
-----------------------------------------------------------------------------------------------------------------------------------
Review of employee entitlements and allowances ~280 (Up Arrow) Operating costs –
Group and Unallocated
-----------------------------------------------------------------------------------------------------------------------------------
Transaction and integration costs associated with the OZL acquisition ~100 - 150 (Up Arrow) Operating costs -
Group and Unallocated
-----------------------------------------------------------------------------------------------------------------------------------
Increase to depreciation and amortisation expense relative to H1 FY23,
predominantly at WAIO, and includes the contribution of the OZL assets
acquired during the period ~100 - 200 (Up Arrow) Depreciation,
amortisation and impairments
-----------------------------------------------------------------------------------------------------------------------------------
The Group’s adjusted effective tax rate for the 2023 financial year is -- Taxation expense
expected to be in the lower half of the guidance range of 30 to 35 per cent
-----------------------------------------------------------------------------------------------------------------------------------
Working capital decrease relating to net price impacts, and 950 - 1,050 (Up Arrow) Operating cash flow
provisions relating to employee entitlements and allowances
-----------------------------------------------------------------------------------------------------------------------------------
Decrease in cash tax paid relative to H1 FY23 1,600 – 1,700 (Up Arrow) Operating cash flow
-----------------------------------------------------------------------------------------------------------------------------------
Gross dividends received from equity-accounted investments ~250 (Up Arrow) Investing cash flow
-----------------------------------------------------------------------------------------------------------------------------------
Capital and exploration spend is expected to be approximately US$7.1 bn, below -- (Up Arrow) Investing cash flow
full year guidance of approximately US$7.6 bn, primarily driven by favourable FX
-----------------------------------------------------------------------------------------------------------------------------------
Gross dividends paid to non-controlling interests ~650 (Down Arrow) Financing cash flow
-----------------------------------------------------------------------------------------------------------------------------------
Payment of the H1 FY23 dividend ~4,600 (Down Arrow) Financing cash flow
-----------------------------------------------------------------------------------------------------------------------------------
Acquisition of OZL ~6,000 (Down Arrow) Investing cash flow
-----------------------------------------------------------------------------------------------------------------------------------
Net debt acquired through OZL acquisition ~1,000 (Up Arrow) Net debt
-----------------------------------------------------------------------------------------------------------------------------------
The Group’s net debt balance at 30 June 2023 is expected to be between US$11 -- Net debt
and US$11.5 bn and is expected to remain towards the upper end of our target
range of US$5 to US$15 bn in the near term
-----------------------------------------------------------------------------------------------------------------------------------
Financial impact on BHP Brasil of the Samarco dam failure Refer footnote/iv/ Exceptional item
The financial impact is expected to primarily relate to amortisation of
discounting on the provision and the impact of foreign exchange
-----------------------------------------------------------------------------------------------------------------------------------
Revaluation of deferred tax balances following the substantive enactment of ~250-300/v/ Exceptional item
the Chilean Royalty Bill
-----------------------------------------------------------------------------------------------------------------------------------
i Numbers are not tax effected and comparisons are against the 31 December
2022 financial results, unless otherwise noted.
ii There will be a corresponding balance sheet, cash flow and/or income
statement impact as relevant, unless otherwise noted.
iii Average exchange rates for FY23 of AUD/USD 0.67 (guidance rate AUD/USD
0.72) and USD/CLP 864 (guidance rate USD/CLP 830).
iv Financial impact is the subject of ongoing work and is not yet finalised.
See Iron ore section for further information on Samarco.
v To reflect an increase to the mining tax rates in Chile.
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BHP Operational Review for the 3
year ended 30 June 2023
Average realised prices
The average realised prices achieved for our major commodities are summarised
below.
FY23 H2 FY23 H2 FY23
vs vs vs
Average realised prices/i/ H2 FY23 H1 FY23 FY23 FY22 FY22 H2 FY22 H1 FY23
-------------------------- ------- ------- ------ ------ ----- ------- -------
Copper (US$/lb) /ii/................. 3.80 3.49 3.65 4.16 (12%) (5%) 9%
Iron ore (US$/wmt, FOB).............. 99.88 85.46 92.54 113.10 (18%) (11%) 17%
Metallurgical coal (US$/t)........... 273.08 268.73 271.05 347.10 (22%) (36%) 2%
Hard coking coal (US$/t) /iii/.... 276.22 270.65 273.59 366.82 (25%) (37%) 2%
Weak coking coal (US$/t) /iii/.... 250.38 252.12 251.13 296.51 (15%) (35%) (1%)
Thermal coal (US$/t) /iv/............ 157.21 354.30 236.51 216.78 9% (48%) (56%)
Nickel metal (US$/t)................. 23,652 24,362 24,021 23,275 3% (14%) (3%)
i Based on provisional, unaudited estimates. Prices exclude sales from equity
accounted investments, third party product and internal sales, and
represent the weighted average of various sales terms (for example: FOB,
CIF and CFR), unless otherwise noted. Includes the impact of provisional
pricing and finalisation adjustments.
ii Does not include sales from assets acquired through the purchase of OZL.
iii Hard coking coal (HCC) refers generally to those metallurgical coals with a
Coke Strength after Reaction (CSR) of 35 and above, which includes coals
across the spectrum from Premium Coking to Semi Hard Coking coals, while
weak coking coal (WCC) refers generally to those metallurgical coals with a
CSR below 35.
iv Export sales only. Includes thermal coal sales from metallurgical coal
mines.
The large majority of iron ore shipments were linked to index pricing for the
month of shipment, with price differentials predominantly a reflection of market
fundamentals and product quality. Iron ore sales for the June 2023 half year
were based on an average moisture rate of 6.6 per cent. The large majority of
metallurgical coal and energy coal exports were linked to index pricing for the
month of scheduled shipment or priced on the spot market at fixed or
index-linked prices, with price differentials reflecting product quality. The
large majority of copper cathodes sales were linked to index price for quotation
periods one month after month of shipment, and three to four months after month
of shipment for copper concentrates sales with price differentials applied for
location and treatment costs.
At 30 June 2023, the Group had 342 kt of outstanding copper sales that were
revalued at a weighted average price of US$3.77 per pound. The final price of
these sales will be determined in the 2024 financial year.
In addition, 354 kt of copper sales from the 2022 financial year were subject
to a finalisation adjustment in the 2023 financial year. The provisional
pricing and finalisation adjustments will decrease Underlying EBITDA by
US$243 million in the 2023 financial year and are included in the average
realised copper price in the above table.
Corporate update
BHP released its sixth Reconciliation Action Plan in June 2023, which has been
recognised with 'Elevate' status from Reconciliation Australia. Some examples
of the commitments made in the plan include increasing Indigenous
representation across our Australian workforce to a target of 9.7 per cent by
the end of the 2027 financial year, and a target to achieve an A$1.5 billion
spend with Traditional Owner and Indigenous businesses in aggregate across our
Australian assets.
Portfolio
On 2 May 2023, BHP announced the completion of the OZL acquisition. The
acquisition strengthens BHP's portfolio in copper, nickel and uranium and is in
line with our strategy to pursue value adding growth in future facing
commodities. The cash payment by BHP was funded using a combination of BHP's
existing cash reserves and the proceeds of a debt facility.
In June 2023, BHP agreed to invest an additional C$30 million in Filo Mining
Corp via a private placement. The proceeds from BHP's investment will be used
by Filo for exploration and development of the Filo del Sol project, located in
San Juan Province, Argentina and adjacent Region III in Chile, and for working
capital and general corporate purposes.
Decarbonisation
In the June 2023 quarter, BHP held a briefing updating on its progress and
plans to achieve its medium and long-term operational decarbonisation target
and goal and released two Prospects updates on the Pathways to decarbonisation
which are available on the BHP website: The many, many roads to Paris and the
electric smelting furnace.
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BHP Operational Review for the 4
year ended 30 June 2023
Copper
Production
FY23 Jun Q23 Jun Q23
vs vs vs
FY23 Jun Q23 FY22 Jun Q22 Mar Q23
------- ------- ---- ------- -------
Copper (kt).............. 1,716.5 476.2 9% 3% 17%
Zinc (t)................. 125,048 38,822 1% 41% 64%
Uranium (t).............. 3,406 813 43% 5% (2%)
Copper - Total copper production increased by nine per cent to 1,717 kt.
Production for the 2024 financial year is expected to be between 1,720 and
1,910 kt.
Escondida copper production increased by five per cent to 1,055 kt primarily due
to higher concentrator feed grade of 0.82 per cent, compared to 0.78 per cent in
the 2022 financial year. The positive impact of the higher grade was partially
offset by the impact of road blockades across Chile in the December 2022
quarter, which reduced availability of some key mine supplies. Full year
production came in at the low end of revised guidance largely as a result of
measures implemented to manage geotechnical events in a high grade section of
the Escondida pit. These included a resequencing of the mine plan, resulting in
lower than anticipated volumes of mined ore and increased processing of lower
grade stockpiles through the concentrators. Production is expected to increase
to between 1,080 and 1,180 kt for the 2024 financial year and reflects both an
expected increase in concentrator feed grade and an expected increase in
concentrator throughput compared to the 2023 financial year.
Pampa Norte copper production increased by three per cent to 289 kt including a
record 240 kt at Spence and 49 kt at Cerro Colorado. This was largely a result
of higher concentrator throughput at the Spence Growth Option (SGO), partially
offset by lower production at Cerro Colorado as it transitions towards closure.
The concentrator plant modifications, which commenced in August 2022, remain on
track to be completed in the 2023 calendar year. Expected capital expenditure
for the concentrator modification works remains unchanged at approximately
US$100 million. Production for Spence is expected to be between 210 and 250
kt for the 2024 financial year, with planned higher concentrator grade and
concentrator throughput but lower stacking grade for cathodes. Cerro Colorado
continues to transition towards planned closure by December 2023, with
production for the six months until closure expected to be approximately 9 kt.
We are continuing to closely monitor previously identified Spence Tailings
Storage Facility anomalies.
Following the completion of the acquisition of OZL, we have established the
Copper South Australia business. Production from Copper South Australia was 232
kt, comprised of full year production from Olympic Dam of 212 kt and two months
of production/2/ from Prominent Hill and Carrapateena of 8 kt and 12 kt
respectively. Olympic Dam delivered record BHP copper production as a result of
continued strong concentrator and smelter performance following the major
smelter maintenance campaign (SCM21) in the prior year. Record annual gold and
silver production was also achieved following the implementation of
debottlenecking initiatives in the prior year, 27 per cent higher than the
previous gold production record.
Integration activity is underway, including the transfer of small volumes of
copper concentrate from Prominent Hill to Olympic Dam for processing. Copper
South Australia production of between 310 and 340 kt is expected for the 2024
financial year.
Antamina copper production decreased by eight per cent to 138 kt reflecting the
expected lower copper feed grades, partially offset by higher throughput. Zinc
production was one per cent higher at 125 kt, reflecting higher throughput.
Copper production of 120 to 140 kt and zinc production of between 85 and 105 kt
is expected for the 2024 financial year.
Following the acquisition of OZL, Carajas produced 1.6 kt of copper and 1.2
troy koz of gold/2/.
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BHP Operational Review for the 5
year ended 30 June 2023
Iron ore
Production
FY23 Jun Q23 Jun Q23
vs vs vs
FY23 Jun Q23 FY22 Jun Q22 Mar Q23
------- ------- ---- ------- -------
Iron ore (kt)................. 257,043 65,295 1% 2% 9%
Iron ore - Total iron ore production increased by one per cent to 257 Mt.
Production for the 2024 financial year is expected to be between 254 and
264.5 Mt.
WAIO achieved record production of 253 Mt (285 Mt on a 100 per cent basis),
reflecting continued strong supply chain performance, including improved rail
performance and increased car dumper utilisation. This was partially offset by
the temporary suspension of operations following the fatality in February,
unfavourable weather impacts from Tropical Cyclone Ilsa in the June 2023
quarter and the ongoing planned tie-in of PDP1, which remains on track to be
completed in the 2024 calendar year.
South Flank remains on track to ramp up to full production capacity of 80 Mtpa
(100 per cent basis) by the end of the 2024 financial year. Current year
performance has contributed to record annual production at the Mining Area C
hub and record WAIO lump sales. Additionally, the deployment of autonomous haul
trucks at South Flank was completed in May 2023.
WAIO also achieved record shipments for the year, which was inclusive of sales of
249 Mt (281 Mt on a 100 per cent basis) and inventory in China of almost 4 Mt
for portside sales.
WAIO production is expected to increase to between 250 and 260 Mt (282 and
294 Mt on a 100 per cent basis) in the 2024 financial year.
Samarco production increased by 11 per cent to 4.5 Mt (BHP share), as a result
of higher concentrator throughput. Production for the 2024 financial year is
expected to be between 4 and 4.5 Mt (BHP share).
In May 2023, Samarco announced it had agreed with its shareholders and a group
of Samarco's financial creditors to a restructure of the company's financial debts.
The agreement was entered into following a 2-month court-supervised settlement
process. The proposed terms are subject to approval by a majority of Samarco's
creditors, ratification by the Judicial Reorganisation Court and the entry into
definitive debt restructure documents. Samarco, BHP Brasil, Vale, and creditors
are working together to implement the restructure terms to resolve Samarco's
judicial reorganisation process.
--------------------------------------------------------------------------------
BHP Operational Review for the 6
year ended 30 June 2023
Coal
Production
FY23 Jun Q23 Jun Q23
Jun vs vs vs
FY23 Q23 FY22 Jun Q22 Mar Q23
------ ----- ---- ------- -------
Metallurgical coal (kt)....... 29,020 8,477 0% 4% 22%
Energy coal (kt).............. 14,172 4,765 3% 22% 21%
Metallurgical coal - BMA production of 29 Mt (58 Mt on a 100 per cent basis)
was in line with the prior period. The significant wet weather experienced in
the first three quarters/4/ was offset by strong underlying operational
performance, in particular, continued improvement in truck productivity at
Goonyella and Daunia following the completion of their transitions to
autonomous fleet. Production for the period was further supported by a drawdown
of raw coal inventory and improved labour availability compared to the prior
period.
Production for the 2024 financial year is expected to be between 28 and 31 Mt
(56 and 62 Mt on a 100 per cent basis).
The near tripling of top end royalties by the Queensland Government makes
Queensland the highest coal taxing regime in the world. Given the negative
impact this has on investment economics and the increase in sovereign risk, we
will not be investing in any further growth in Queensland, however we will
sustain and optimise our existing operations.
Energy coal - NSWEC production increased by three per cent to 14.2 Mt driven by
an improvement in weather conditions in the second half of the year and an
uplift in truck productivity compared to the prior year. Additional deployed
capacity into a new mining area also resulted in an uplift in prime stripping
volumes. Production for the 2024 financial year is expected to be between 13
and 15 Mt.
Higher quality products made up 77 per cent of sales, compared to 89 per cent
in the prior period, reflecting the impacts of the change in export market
conditions and the commencement of domestic sales under the NSW Government Coal
Market Price Emergency (Directions for Coal Mines) Notice in the June 2023
quarter. The reservation allocation for the 2024 financial year is expected to
be 0.7 Mt in line with the Directions.
Other
Nickel production
FY23 Jun Q23 Jun Q23
vs vs vs
FY23 Jun Q23 FY22 Jun Q22 Mar Q23
---- ------- ---- ------- -------
Nickel (kt)................... 80.0 22.0 4% 17% 12%
Nickel - Nickel West production increased by four per cent to 80 kt due to an
increased proportion of concentrate and matte products and inventory drawdowns.
This was partially offset by the slower than planned ramp up of the refinery
following planned maintenance in the December 2022 quarter and a heavy rain
event at the Mt Keith operations in early April 2023 impacting mine progression.
During the year, Nickel West has experienced ongoing issues with the quality
and volume of ore deliveries from Mincor Resources containing high levels of
arsenic, and in March advised that it would no longer accept off-specification
product. In the second half, Nickel West purchased more third-party products
compared to the first half, including higher cost third party concentrate to
offset the impact of the ore supply issues.
Production is expected to be between 77 and 87 kt for the 2024 financial year,
weighted to the second half of the year due to planned refinery maintenance in
the first half.
The West Musgrave nickel project in Western Australia is in early stages of
execution following the final investment decision by OZL in September 2022
(prior to the acquisition by BHP).
Potash - Our major potash project under development at Jansen is tracking to
the accelerated plan with first production still targeted for the end of the
2026 calendar year, compared to the initial target of the 2027 calendar year.
In the June 2023 quarter, we completed all piling activities for the mill and
storage facilities. During the 2024 financial year, we will transition from
civil works into steel and equipment installation on the surface and
underground, as well as continuing with equipment procurement. Port
construction will also continue. The feasibility study for Jansen Stage 2
continues to progress and is on track to be completed during the 2024 financial
year.
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BHP Operational Review for the 7
year ended 30 June 2023
Projects
Capital Initial
Project and expenditure production
ownership US$M target date Capacity Progress
----------- ----------- ----------- ------------------------------------- ----------------------------------
Jansen Stage 1 5,723 End-CY26 Design, engineering and construction Project is 26% complete
(Canada) of an underground potash mine and
100% surface infrastructure, with capacity
to produce 4.35 Mtpa.
Minerals exploration
Minerals exploration and evaluation expenditure increased by 37 per cent for the
year ended 30 June 2023 to US$350 million, of which US$294 million was expensed.
At BHP's recently identified copper porphyry mineralised system, Ocelot, located
in the Miami-Globe copper district of the United States, the final hole of a
6-hole program was completed in May 2023. The project remains at an early
exploration stage and data from the recent drill program will be used to update
the overall resource range estimation at Ocelot.
At Oak Dam in South Australia, we have defined an Exploration Target/3/ (refer to
Appendix 1) and commenced the next phase of drilling as we work towards defining
a first Mineral Resource/5/. In line with the environmental approvals received
in March 2023, we plan to increase from nine drill rigs to eleven and to
establish core processing facilities and an accommodation camp of up to 150
rooms by the end of the 2023 calendar year. We are continuing community and
stakeholder engagement in preparation for submission of our application to
convert the Oak Dam tenement from an exploration licence to a retention lease,
enabling progression of an early access decline.
In addition, we have commenced exploratory drilling beneath the Olympic Dam
mine, at depths between 900m and 1,500m, with nine surface exploration rigs.
In June 2023, BHP signed a Sales and Purchase Agreement to acquire 100 per
cent of Ragnar Metals Sweden AB, for a cash payment of A$9.8 million. Ragnar's
assets include the Granmuren Nickel project, an early-stage nickel-copper
tenement package located 110 km north-west of Stockholm, Sweden. BHP intends to
undertake additional drilling to determine whether the known mineralisation has
continuous high grade nickel sulphide and to test additional targets.
The inaugural BHP Xplor accelerator program was completed, with a number of the
early-stage mineral exploration companies selected for further investment.
Applications for the program's second year will open at the end of August 2023.
Elsewhere, we continue to progress exploration activities in Australia, Canada,
Chile, Ecuador, Peru, Serbia and the United States.
Variance analysis relates to the relative performance of BHP and/or its
operations during the 12 months ended June 2023 compared with the 12 months
ended June 2022, unless otherwise noted. Production volumes, sales volumes and
capital and exploration expenditure from subsidiaries are reported on a 100 per
cent basis; production and sales volumes from equity accounted investments and
other operations are reported on a proportionate consolidation basis. Numbers
presented may not add up precisely to the totals provided due to rounding.
The following footnotes apply to this Operational Review:
1 2023 financial year unit cost guidance: Escondida US$1.25-1.45/lb, WAIO
US$18-19/t, BMA US$100-105/t and NSWEC US$84-91/t; based on exchange rates
of AUD/USD 0.72 and USD/CLP 830.
2 Throughout this report, production volumes for the operations acquired from
OZL are for the period of 1 May to 30 June 2023, whilst the acquisition
completion date was 2 May 2023.
3 An Exploration Target is a statement or estimate of the exploration
potential of a mineral deposit in a defined geological setting where the
statement or estimate, quoted as a range of tonnes and a range of grade (or
quality), relates to mineralisation for which there has been insufficient
exploration to estimate a Mineral Resource.
4 803mm of rainfall recorded at Moranbah for the year ended 30 June 2023
compared to 648mm in the prior year.
5 The potential quantity and grade of an Exploration Target is conceptual in
nature and as such there has been insufficient exploration to estimate a
Mineral Resource, and it is uncertain if further exploration or analysis
will result in the estimation of a Mineral Resource.
The following abbreviations may have been used throughout this report: cost and
freight (CFR); cost, insurance and freight (CIF); dry metric tonne unit (dmtu);
free on board (FOB); grams per tonne (g/t); kilograms per tonne (kg/t);
kilometre (km); megawatt (MW); metre (m); millimetre (mm); million tonnes (Mt);
million tonnes per annum (Mtpa); ounces (oz); pounds (lb); thousand ounces
(koz); thousand tonnes (kt); thousand tonnes per annum (ktpa); thousand tonnes
per day (ktpd); tonnes (t); and wet metric tonnes (wmt).
In this release, the terms 'BHP', the 'Group', 'BHP Group', 'we', 'us', 'our'
and 'ourselves' are used to refer to BHP Group Limited and, except where the
context otherwise requires, our subsidiaries. Refer to note 28 'Subsidiaries'
of the Financial Statements in BHP's 30 June 2022 Appendix 4E for a list of our
significant subsidiaries. Those terms do not include non-operated assets. On
and from 2 May, the BHP Group includes OZ Minerals Limited and its subsidiaries
referred to in note 17 of their Financial Statements in its Annual Report for the
year ended 30 December 2022. Notwithstanding that this release may include
production, financial and other information from non-operated assets,
non-operated assets are not included in the BHP Group and, as a result,
statements regarding our operations, assets and values apply only to our
operated assets unless stated otherwise. Our non-operated assets include
Antamina and Samarco. BHP Group cautions against undue reliance on any
forward-looking statement or guidance in this release, particularly in light of
the current economic climate and significant volatility, uncertainty and
disruption arising in connection with COVID-19. These forward-looking
statements are based on information available as at the date of this release
and are not guarantees or predictions of future performance and involve known
and unknown risks, uncertainties and other factors, many of which are beyond
our control and which may cause actual results to differ materially from those
expressed in the statements contained in this release.
--------------------------------------------------------------------------------
BHP Operational Review for the 8
year ended 30 June 2023
Further information on BHP can be found at: bhp.com
Authorised for lodgement by:
Stefanie Wilkinson
Group Company Secretary
Sponsor: J.P. Morgan Equities South Africa Proprietary Limited
Media Relations Investor Relations
Email: media.relations@bhp.com Email: investor.relations@bhp.com
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--------------------------------------------------------------------------------
BHP Operational Review for the 9
year ended 30 June 2023
Production summary
Quarter ended Year to date
-------------------------------------- ---------------
Jun Sep Dec Mar Jun Jun Jun
BHP 2022 2022 2022 2023 2023 2023 2022
interest ------ ------- ------- ------- ------- ------- -------
Copper/1/
Copper
Payable metal in concentrate (kt)
Escondida /2/ ......................... 57.5% 233.5 203.1 208.3 200.8 220.5 832.7 802.6
Pampa Norte /3/ ....................... 100% 28.2 28.6 32.5 32.0 32.2 125.3 111.2
Copper South Australia /4/............. 100% 19.9 19.9
Antamina .............................. 33.8% 39.6 37.1 35.2 29.6 36.5 138.4 149.9
Carajas /5/............................ 100% 1.6 1.6
------ ------- ------- ------- ------- ------- -------
Total ................................. 301.3 268.8 276.0 262.4 310.7 1,117.9 1,063.7
------ ------- ------- ------- ------- ------- -------
Cathode (kt)
Escondida /2/.......................... 57.5% 55.8 49.6 49.7 50.8 72.5 222.6 201.4
Pampa Norte /3/........................ 100% 49.0 42.0 44.2 41.0 36.3 163.5 170.0
Copper South Australia /4/............. 100% 55.7 49.7 54.4 51.7 56.7 212.5 138.4
------ ------- ------- ------- ------- ------- -------
Total 160.5 141.3 148.3 143.5 165.5 598.6 509.8
------ ------- ------- ------- ------- ------- -------
Total copper (kt) 461.8 410.1 424.3 405.9 476.2 1,716.5 1,573.5
------ ------- ------- ------- ------- ------- -------
Lead
Payable metal in concentrate (t)
Antamina .............................. 33.8% 181 228 114 169 146 657 1,118
------ ------- ------- ------- ------- ------- -------
Total ................................. 181 228 114 169 146 657 1,118
------ ------- ------- ------- ------- ------- -------
Zinc
Payable metal in concentrate (t)
Antamina .............................. 33.8% 27,576 32,685 29,929 23,612 38,822 125,048 123,200
------ ------- ------- ------- ------- ------- -------
Total ................................. 27,576 32,685 29,929 23,612 38,822 125,048 123,200
------ ------- ------- ------- ------- ------- -------
Gold
Payable metal in concentrate (troy oz)
Escondida /2/.......................... 57.5% 45,770 38,236 48,402 48,954 53,503 189,095 166,972
Pampa Norte /3/........................ 100% 8,198 5,521 3,875 8,152 9,263 26,811 28,870
Copper South Australia /4/............. 100% 32,736 32,736
Carajas /5/ ........................... 100% 1,153 1,153
------ ------- ------- ------- ------- ------- -------
Total ................................. 53,968 43,757 52,277 57,106 96,655 249,795 195,842
------ ------- ------- ------- ------- ------- -------
Refined gold (troy oz)
Copper South Australia /4/............. 100% 26,080 47,184 43,280 49,086 46,479 186,029 119,517
------ ------- ------- ------- ------- ------- -------
Total ................................. 26,080 47,184 43,280 49,086 46,479 186,029 119,517
------ ------- ------- ------- ------- ------- -------
Total gold (troy oz) ..................... 80,048 90,941 95,557 106,192 143,134 435,824 315,359
------ ------- ------- ------- ------- ------- -------
Silver
Payable metal in concentrate (troy koz)
Escondida /2/.......................... 57.5% 1,311 1,210 1,510 1,346 1,008 5,074 5,334
Pampa Norte /3/........................ 100% 262 252 245 409 412 1,318 1,011
Copper South Australia /4/............. 100% 201 201
Antamina .............................. 33.8% 1,212 1,190 923 801 971 3,885 5,078
------ ------- ------- ------- ------- ------- -------
Total ................................. 2,785 2,652 2,678 2,556 2,592 10,478 11,423
------ ------- ------- ------- ------- ------- -------
Refined silver (troy koz)
Copper South Australia /4/............. 100% 145 295 261 277 256 1,089 743
------ ------- ------- ------- ------- ------- -------
Total ................................. 145 295 261 277 256 1,089 743
------ ------- ------- ------- ------- ------- -------
Total silver (troy koz) .................. 2,930 2,947 2,939 2,833 2,848 11,567 12,166
------ ------- ------- ------- ------- ------- -------
Uranium
Payable metal in concentrate (t)
Copper South Australia /4/............. 100% 776 817 943 833 813 3,406 2,375
------ ------- ------- ------- ------- ------- -------
Total ................................. 776 817 943 833 813 3,406 2,375
------ ------- ------- ------- ------- ------- -------
--------------------------------------------------------------------------------
BHP Operational Review for the 10
year ended 30 June 2023
Production summary
Quarter ended Year to date
-------------------------------------- ---------------
Jun Sep Dec Mar Jun Jun Jun
BHP 2022 2022 2022 2023 2023 2023 2022
interest ------ ------- ------- ------- ------- ------- -------
Molybdenum
Payable metal in concentrate (t)
Pampa Norte /3/........................ 100% 71 34 216 407 333 990 71
Antamina .............................. 33.8% 249 262 348 229 333 1,172 798
------ ------- ------- ------- ------- ------- -------
Total ................................. 320 296 564 636 666 2,162 869
------ ------- ------- ------- ------- ------- -------
--------------------------------------------------------------------------------
BHP Operational Review for the 11
year ended 30 June 2023
Production summary
Quarter ended Year to date
-------------------------------------- ---------------
Jun Sep Dec Mar Jun Jun Jun
BHP 2022 2022 2022 2023 2023 2023 2022
interest ------ ------- ------- ------- ------- ------- -------
Iron Ore
Iron Ore
Production (kt) /6/
Newman ................................ 85% 14,063 14,053 16,172 11,925 14,795 56,945 57,041
Area C Joint Venture .................. 85% 27,685 26,971 26,302 25,284 28,818 107,375 94,431
Yandi Joint Venture ................... 85% 6,409 5,497 5,613 4,941 5,359 21,410 38,922
Jimblebar /7/.......................... 85% 15,005 17,404 17,720 16,575 15,102 66,801 58,782
Samarco ............................... 50% 1,000 1,148 1,095 1,048 1,221 4,512 4,071
------ ------- ------- ------- ------- ------- -------
Total ................................. 64,162 65,073 66,902 59,773 65,295 257,043 253,247
------ ------- ------- ------- ------- ------- -------
Coal
Metallurgical coal
Production (kt) /8/
BHP Mitsubishi Alliance (BMA) ......... 50% 8,183 6,662 6,952 6,929 8,477 29,020 29,142
------ ------- ------- ------- ------- ------- -------
Total ................................. 8,183 6,662 6,952 6,929 8,477 29,020 29,142
------ ------- ------- ------- ------- ------- -------
Energy coal
Production (kt)
NSW Energy Coal ....................... 100% 3,919 2,622 2,851 3,934 4,765 14,172 13,701
------ ------- ------- ------- ------- ------- -------
Total ................................. 3,919 2,622 2,851 3,934 4,765 14,172 13,701
------ ------- ------- ------- ------- ------- -------
Other
Nickel
Saleable production (kt)
Nickel West ........................... 100% 18.8 20.7 17.7 19.6 22.0 80.0 76.8
------ ------- ------- ------- ------- ------- -------
Total ................................. 18.8 20.7 17.7 19.6 22.0 80.0 76.8
------ ------- ------- ------- ------- ------- -------
Cobalt
Saleable production (t)
Nickel West ........................... 100% 110 238 93 175 246 752 632
------ ------- ------- ------- ------- ------- -------
Total ................................. 110 238 93 175 246 752 632
------ ------- ------- ------- ------- ------- -------
1 Metal production is reported on the basis of payable metal.
2 Shown on a 100% basis. BHP interest in saleable production is 57.5%.
3 Includes Spence and Cerro Colorado. Refer to the Production and Sales
Report for more details.
4 Includes Olympic Dam and two months of production from Prominent Hill and
Carrapateena from 1 May 2023, following the acquisition of OZL on 2
May 2023. Refer to the Production and Sales Report for more details.
5 Includes two months of production from 1 May 2023, following the acquisiton
of OZL on 2 May 2023.
6 Iron ore production is reported on a wet tonnes basis.
7 Shown on a 100% basis. BHP interest in saleable production is 85%.
8 Metallurgical coal production is reported on the basis of saleable product.
Production figures may include some thermal coal.
Throughout this report figures in italics indicate that this figure has been
adjusted since it was previously reported.
--------------------------------------------------------------------------------
BHP Operational Review for the 12
year ended 30 June 2023
Production and sales report
Quarter ended Year to date
------------------------------------------- ----------------
Jun Sep Dec Mar Jun Jun Jun
2022 2022 2022 2023 2023 2023 2022
------- ------- ------- ------- ------- ------- -------
Copper
Metals production is payable metal unless otherwise stated.
Escondida, Chile /1/
Material mined ................................ (kt) 115,409 110,248 101,987 106,170 95,451 413,856 454,243
Concentrator throughput ....................... (kt) 34,318 32,894 33,911 33,309 30,750 130,864 133,868
Average copper grade - concentrator ........... (%) 0.88% 0.83% 0.76% 0.78% 0.93% 0.82% 0.78%
Production ex mill ............................ (kt) 239.5 214.6 212.8 210.0 228.9 866.3 835.8
Production
Payable copper ................................ (kt) 233.5 203.1 208.3 200.8 220.5 832.7 802.6
Copper cathode (EW) ........................... (kt) 55.8 49.6 49.7 50.8 72.5 222.6 201.4
- Oxide leach ................................ (kt) 17.5 15.2 17.6 14.7 29.3 76.8 57.6
- Sulphide leach ............................. (kt) 38.3 34.4 32.1 36.1 43.2 145.8 143.8
------- ------- ------- ------- ------- ------- -------
Total copper .................................. (kt) 289.3 252.7 258.0 251.6 293.0 1,055.3 1,004.0
------- ------- ------- ------- ------- ------- -------
Payable gold concentrate ...................... (troy oz) 45,770 38,236 48,402 48,954 53,503 189,095 166,972
Payable silver concentrate .................... (troy koz) 1,311 1,210 1,510 1,346 1,008 5,074 5,334
Sales
Payable copper ................................ (kt) 230.4 196.7 216.0 197.3 220.3 830.3 798.1
Copper cathode (EW) ........................... (kt) 58.9 45.9 53.5 43.8 78.0 221.2 202.5
Payable gold concentrate ...................... (troy oz) 45,770 38,236 48,402 48,954 53,503 189,095 166,972
Payable silver concentrate .................... (troy koz) 1,311 1,210 1,510 1,346 1,008 5,074 5,334
1 Shown on a 100% basis. BHP interest in saleable production is 57.5%.
Pampa Norte, Chile
Cerro Colorado
Material mined ................................ (kt) 3,604 3,179 583 172 145 4,079 17,280
Ore stacked ................................... (kt) 4,259 4,373 4,119 3,567 3,928 15,987 15,035
Average copper grade - stacked ................ (%) 0.55% 0.54% 0.56% 0.57% 0.53% 0.55% 0.58%
Production
Copper cathode (EW) ........................... (kt) 14.7 12.8 12.2 12.0 12.2 49.2 55.0
Sales
Copper cathode (EW) ........................... (kt) 16.2 13.3 12.2 10.9 14.1 50.5 54.8
Spence
Material mined ................................ (kt) 26,749 26,956 26,980 24,858 25,622 104,416 95,968
Ore stacked ................................... (kt) 5,099 5,577 5,155 4,947 5,625 21,304 20,483
Average copper grade - stacked ................ (%) 0.66% 0.70% 0.66% 0.60% 0.58% 0.64% 0.66%
Concentrator throughput ....................... (kt) 6,311 6,433 7,602 7,290 6,927 28,252 24,843
Average copper grade - concentrator ........... (%) 0.66% 0.63% 0.60% 0.61% 0.61% 0.61% 0.64%
Production
Payable copper ................................ (kt) 28.2 28.6 32.5 32.0 32.2 125.3 111.2
Copper cathode (EW) ........................... (kt) 34.3 29.2 32.0 29.0 24.1 114.3 115.0
------- ------- ------- ------- ------- ------- -------
Total copper .................................. (kt) 62.5 57.8 64.5 61.0 56.3 239.6 226.2
------- ------- ------- ------- ------- ------- -------
Payable gold concentrate ...................... (troy oz) 8,198 5,521 3,875 8,152 9,263 26,811 28,870
Payable silver concentrate .................... (troy koz) 262 252 245 409 412 1,318 1,011
Payable molybdenum ............................ (t) 71 34 216 407 333 990 71
--------------------------------------------------------------------------------
BHP Operational Review for the 13
year ended 30 June 2023
Production and sales report
Quarter ended Year to date
------------------------------------------- ----------------
Jun Sep Dec Mar Jun Jun Jun
2022 2022 2022 2023 2023 2023 2022
------- ------- ------- ------- ------- ------- -------
Sales
Payable copper ................................ (kt) 28.1 26.0 22.0 38.7 38.6 125.3 109.5
Copper cathode (EW) ........................... (kt) 35.4 29.1 33.4 25.1 28.3 115.9 114.5
Payable gold concentrate ...................... (troy oz) 8,198 5,521 3,875 8,152 9,263 26,811 28,870
Payable silver concentrate .................... (troy koz) 262 252 245 409 412 1,318 1,011
Payable molybdenum ............................ (t) 25 25 216 492 367 1,100 25
--------------------------------------------------------------------------------
BHP Operational Review for the 14
year ended 30 June 2023
Production and sales report
Quarter ended Year to date
------------------------------------------- ----------------
Jun Sep Dec Mar Jun Jun Jun
2022 2022 2022 2023 2023 2023 2022
------- ------- ------- ------- ------- ------- -------
Copper (continued)
Metals production is payable metal unless otherwise stated.
Copper South Australia
Olympic Dam
Material mined /1/............................. (kt) 2,477 2,412 2,264 2,317 2,356 9,349 8,834
Ore milled .................................... (kt) 2,436 2,570 2,687 2,433 2,755 10,445 7,687
Average copper grade .......................... (%) 2.15% 2.13% 2.08% 1.95% 2.00% 2.04% 2.14%
Average uranium grade ......................... (kg/t) 0.56 0.58 0.58 0.59 0.55 0.58 0.57
Production
Copper cathode (ER and EW) .................... (kt) 55.7 49.7 54.4 51.7 56.7 212.5 138.4
Payable uranium ............................... (t) 776 817 943 833 813 3,406 2,375
Refined gold .................................. (troy oz) 26,080 47,184 43,280 49,086 46,479 186,029 119,517
Refined silver ................................ (troy koz) 145 295 261 277 256 1,089 743
Sales
Copper cathode (ER and EW) .................... (kt) 55.8 45.9 56.8 50.5 59.5 212.7 139.1
Payable uranium ............................... (t) 1,031 272 1,127 683 1,275 3,357 2,344
Refined gold .................................. (troy oz) 24,622 49,542 41,900 47,300 49,182 187,924 118,979
Refined silver ................................ (troy koz) 87 320 233 307 270 1,130 685
Prominent Hill /2/
Material mined ................................ (kt) 661 661
Ore milled .................................... (kt) 1,228 1,228
Average copper grade .......................... (%) 0.77% 0.77%
Production ex mill ............................ (kt) 16.3 16.3
Production
Payable copper ................................ (kt) 8.2 8.2
Payable gold concentrate ...................... (troy oz) 17,432 17,432
Payable silver concentrate .................... (troy koz) 44 44
Sales
Payable copper ................................ (kt) 15.7 15.7
Payable gold concentrate ...................... (troy oz) 28,856 28,856
Payable silver concentrate .................... (troy koz) 87 87
Carrapateena /2/
Material mined ................................ (kt) 880 880
Ore milled .................................... (kt) 856 856
Average copper grade .......................... (%) 1.52% 1.52%
Production ex mill ............................ (kt) 30.1 30.1
Production
Payable copper ................................ (kt) 11.7 11.7
Payable gold concentrate ...................... (troy oz) 15,304 15,304
Payable silver concentrate .................... (troy koz) 157 157
Sales
Payable copper ................................ (kt) 11.9 11.9
Payable gold concentrate ...................... (troy oz) 15,242 15,242
Payable silver concentrate .................... (troy koz) 155 155
1 Material mined refers to underground ore mined, subsequently hoisted or trucked to surface.
2 Includes two months of production and sales from 1 May 2023, following the acquisiton of OZL on 2 May 2023.
--------------------------------------------------------------------------------
BHP Operational Review for the 15
year ended 30 June 2023
Production and sales report
Quarter ended Year to date
------------------------------------------- ----------------
Jun Sep Dec Mar Jun Jun Jun
2022 2022 2022 2023 2023 2023 2022
------- ------- ------- ------- ------- ------- -------
Copper (continued)
Metals production is payable metal unless otherwise stated.
Antamina, Peru
Material mined (100%) ......................... (kt) 64,026 63,865 68,750 57,939 62,894 253,448 246,904
Concentrator throughput (100%) ................ (kt) 13,131 13,858 14,272 12,349 13,897 54,376 52,496
Average head grades
- Copper ..................................... (%) 1.02% 0.93% 0.86% 0.88% 0.88% 0.89% 0.98%
- Zinc ....................................... (%) 1.05% 1.09% 0.99% 1.06% 1.25% 1.10% 1.11%
Production
Payable copper ................................ (kt) 39.6 37.1 35.2 29.6 36.5 138.4 149.9
Payable zinc .................................. (t) 27,576 32,685 29,929 23,612 38,822 125,048 123,200
Payable silver ................................ (troy koz) 1,212 1,190 923 801 971 3,885 5,078
Payable lead .................................. (t) 181 228 114 169 146 657 1,118
Payable molybdenum ............................ (t) 249 262 348 229 333 1,172 798
Sales
Payable copper ................................ (kt) 40.7 37.6 34.7 32.4 34.5 139.2 148.2
Payable zinc .................................. (t) 30,847 33,820 29,127 25,851 37,629 126,427 125,915
Payable silver ................................ (troy koz) 1,230 1,015 850 768 747 3,380 4,816
Payable lead .................................. (t) 363 130 91 181 143 545 1,208
Payable molybdenum ............................ (t) 205 250 298 297 227 1,072 660
Carajas, Brazil /1/
Material mined ................................ (kt) 103 103
Ore milled .................................... (kt) 100 100
Average copper grade .......................... (%) 1.71% 1.71%
Production ex mill ............................ (kt) 6.6 6.6
Production
Payable copper ................................ (kt) 1.6 1.6
Payable gold concentrate ...................... (troy oz) 1,153 1,153
Sales
Payable copper ................................ (kt) 2.1 2.1
Payable gold concentrate ...................... (troy oz) 1,688 1,688
1 Includes two months of production and sales from 1 May 2023, following the acquisiton of OZL on 2 May 2023.
--------------------------------------------------------------------------------
BHP Operational Review for the 16
year ended 30 June 2023
Production and sales report
Quarter ended Year to date
------------------------------------------- ----------------
Jun Sep Dec Mar Jun Jun Jun
2022 2022 2022 2023 2023 2023 2022
------- ------- ------- ------- ------- ------- -------
Iron Ore
Iron ore production and sales are reported on a wet tonnes basis.
Western Australia Iron Ore, Australia
Production
Newman ........................................ (kt) 14,063 14,053 16,172 11,925 14,795 56,945 57,041
Area C Joint Venture .......................... (kt) 27,685 26,971 26,302 25,284 28,818 107,375 94,431
Yandi Joint Venture ........................... (kt) 6,409 5,497 5,613 4,941 5,359 21,410 38,922
Jimblebar /1/.................................. (kt) 15,005 17,404 17,720 16,575 15,102 66,801 58,782
Wheelarra ..................................... (kt) -- -- -- -- -- -- --
------- ------- ------- ------- ------- ------- -------
Total production .............................. (kt) 63,162 63,925 65,807 58,725 64,074 252,531 249,176
------- ------- ------- ------- ------- ------- -------
Total production (100%) ....................... (kt) 71,660 72,135 74,292 66,163 72,717 285,307 282,773
------- ------- ------- ------- ------- ------- -------
Sales
Lump .......................................... (kt) 20,006 19,561 20,375 18,021 20,022 77,979 72,345
Fines ......................................... (kt) 44,308 42,696 44,121 41,183 42,904 170,904 178,343
------- ------- ------- ------- ------- ------- -------
Total ......................................... (kt) 64,314 62,257 64,496 59,204 62,926 248,883 250,688
------- ------- ------- ------- ------- ------- -------
Total sales (100%) ............................ (kt) 72,796 70,276 72,688 66,580 71,172 280,716 283,943
------- ------- ------- ------- ------- ------- -------
1 Shown on a 100% basis. BHP interest in saleable production is 85%.
Samarco, Brazil
Production .................................... (kt) 1,000 1,148 1,095 1,048 1,221 4,512 4,071
Sales ......................................... (kt) 991 1,146 1,097 1,111 1,160 4,514 3,995
--------------------------------------------------------------------------------
BHP Operational Review for the 17
year ended 30 June 2023
Production and sales report
Quarter ended Year to date
------------------------------------------- ----------------
Jun Sep Dec Mar Jun Jun Jun
2022 2022 2022 2023 2023 2023 2022
------- ------- ------- ------- ------- ------- -------
Coal
Coal production is reported on the basis of saleable product.
BHP Mitsubishi Alliance (BMA), Australia
Production /1/
Blackwater .................................... (kt) 1,751 1,283 1,160 1,107 1,505 5,055 5,834
Goonyella ..................................... (kt) 2,429 1,780 1,997 2,185 2,348 8,310 8,360
Peak Downs .................................... (kt) 1,366 1,325 1,480 1,251 1,424 5,480 4,944
Saraji ........................................ (kt) 1,168 1,020 1,243 1,007 1,326 4,596 4,614
Daunia ........................................ (kt) 472 324 441 607 617 1,989 1,491
Caval Ridge ................................... (kt) 997 930 631 772 1,257 3,590 3,899
------- ------- ------- ------- ------- ------- -------
Total production .............................. (kt) 8,183 6,662 6,952 6,929 8,477 29,020 29,142
------- ------- ------- ------- ------- ------- -------
Total production (100%) ....................... (kt) 16,366 13,324 13,904 13,858 16,954 58,040 58,284
------- ------- ------- ------- ------- ------- -------
Sales
Coking coal ................................... (kt) 6,734 5,615 5,872 5,372 7,448 24,307 23,358
Weak coking coal .............................. (kt) 1,118 600 727 710 1,064 3,101 3,411
Thermal coal .................................. (kt) 765 267 428 104 364 1,163 2,280
------- ------- ------- ------- ------- ------- -------
Total sales ................................... (kt) 8,617 6,482 7,027 6,186 8,876 28,571 29,049
------- ------- ------- ------- ------- ------- -------
Total sales (100%) ............................ (kt) 17,234 12,964 14,054 12,372 17,752 57,142 58,098
------- ------- ------- ------- ------- ------- -------
1 Production figures include some thermal coal.
NSW Energy Coal, Australia
Production .................................... (kt) 3,919 2,622 2,851 3,934 4,765 14,172 13,701
Sales
Export ........................................ (kt) 3,923 2,441 2,862 3,667 4,693 13,663 14,124
Domestic /1/................................... (kt) -- -- -- -- 201 201 --
------- ------- ------- ------- ------- ------- -------
Total ......................................... (kt) 3,923 2,441 2,862 3,667 4,894 13,864 14,124
------- ------- ------- ------- ------- ------- -------
1 The domestic sales are made under the NSW Government Coal Market Price Emergency (Directions for Coal Mines) Notice 2023.
--------------------------------------------------------------------------------
BHP Operational Review for the 18
year ended 30 June 2023
Production and sales report
Quarter ended Year to date
------------------------------------------- ----------------
Jun Sep Dec Mar Jun Jun Jun
2022 2022 2022 2023 2023 2023 2022
------- ------- ------- ------- ------- ------- -------
Other
Nickel production is reported on the basis of saleable product
Nickel West, Australia
Mt Keith
Nickel concentrate ............................ (kt) 48.0 42.6 39.6 38.8 44.5 165.5 195.8
Average nickel grade .......................... (%) 16.1 17.0 15.5 16.5 16.2 16.3 14.6
Leinster
Nickel concentrate ............................ (kt) 76.0 66.8 47.9 68.4 71.1 254.2 305.2
Average nickel grade .......................... (%) 10.3 9.9 9.4 8.6 8.5 9.1 9.3
Saleable production
Refined nickel /1/............................. (kt) 11.7 17.5 10.8 13.2 13.1 54.6 57.6
Nickel sulphate /2/............................ (kt) 0.5 1.2 0.4 0.9 0.7 3.2 1.6
Intermediates and nickel by-products /3/....... (kt) 6.6 2.0 6.5 5.5 8.2 22.2 17.6
------- ------- ------- ------- ------- ------- -------
Total nickel .................................. (kt) 18.8 20.7 17.7 19.6 22.0 80.0 76.8
------- ------- ------- ------- ------- ------- -------
Cobalt by-products ............................ (t) 110 238 93 175 246 752 632
Sales
Refined nickel /1/............................. (kt) 11.7 18.1 10.2 13.0 13.1 54.4 57.7
Nickel sulphate /2/............................ (kt) 0.5 0.8 0.5 0.9 0.8 3.0 1.3
Intermediates and nickel by-products /3/....... (kt) 6.4 1.8 7.7 5.7 9.5 24.7 16.1
------- ------- ------- ------- ------- ------- -------
Total nickel .................................. (kt) 18.6 20.7 18.4 19.6 23.4 82.1 75.1
------- ------- ------- ------- ------- ------- -------
Cobalt by-products ............................ (t) 110 238 93 175 246 752 632
1 High quality refined nickel metal, including briquettes and powder.
2 Nickel sulphate crystals produced from nickel powder.
3 Nickel contained in matte and by-product streams.
--------------------------------------------------------------------------------
BHP Operational Review for the 19
year ended 30 June 2023
Appendix 1
The Oak Dam Exploration Target, shown in Table 1, was determined using the BHP
internal process of Range Analysis based on 49 drill roles (~61km of drilling).
Refer to "BHP Results for the half year ended 31 December 2022, Appendix 1 -
Explanatory Notes and JORC table 1" for previously reported Exploration Results.
Table 1: Oak Dam Exploration Target.
Low High
--- -----
Tonnes (Mt)................... 500 1,700
Grade (Cu%)................... 0.8 1.1
The potential quantity and grade of an Exploration Target is conceptual in
nature and as such there has been insufficient exploration to estimate a
Mineral Resource. It is uncertain if further exploration or analysis will
result in the estimation of a Mineral Resource.
The target is interpreted as IOGC style of mineralisation based on exploration
results from the Oak Dam project. Currently, drilling is at varying degrees of
spacing.
Target ranges were compiled within a facilitated process called Range Analysis,
in which potential volumes and grades are determined over a range of
assumptions on continuity and extension that are consistent with available data
and genetic models of IOCG copper style of mineralisation.
The target remains open at depth, to the south, and west of "Hardy Hill fault"
as per cross section on figure 1 below.
Figure 1: Oak Dam geology schematic W-E cross section looking north showing
mineralisation is open to the west of Hardy Hill fault, at depth and to the
south.
Intended activities for exploration target testing
BHP is currently running nine drill rigs at Oak Dam, with eleven rigs expected
by November 2023.
A 150-room camp, including a drilling core processing facility, will be
constructed on the tenement in 2023 to support the drilling program.
Competent Persons Statement
The information in this report that relates to Exploration Targets is based on
information compiled by Dr. Kathy Ehrig, a Competent Person who is a Fellow of
The Australasian Institute of Mining and Metallurgy and a Fellow of the
Australian Institute of Geoscientists.
Dr. Kathy Ehrig has sufficient experience that is relevant to the style of
mineralisation and type of deposit under consideration and to the activity
being undertaken to qualify as a Competent Person as defined in the 2012
Edition of the 'Australasian Code for Reporting of Exploration Results.
Dr. Kathy Ehrig consents to the inclusion in the report of the matters based on
her information in the form and context in which it appears.
--------------------------------------------------------------------------------
BHP Operational Review for the 20
year ended 30 June 2023
Date: 20-07-2023 08:15:00
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