Wrap Text
BHP Operational Review for the Year Ended 30 June 2021
BHP Group Plc
Registration number 3196209
Registered in England and Wales
Share code: BHP
ISIN: GB00BH0P3Z91
NEWS RELEASE LOGO
Release Time IMMEDIATE
Date 20 July 2021
Release Number 09/21
BHP OPERATIONAL REVIEW
FOR THE YEAR ENDED 30 JUNE 2021
Note: All guidance is subject to further potential impacts from COVID-19 during
the 2022 financial year.
. Record production was achieved at Western Australia Iron Ore (WAIO) and
Goonyella. Olympic Dam achieved both the highest annual copper production
since the acquisition by BHP in 2005 and the highest gold production ever
for the operation. Escondida maintained average concentrator throughput at
record levels despite a challenging operating environment in Chile as a
result of impacts from COVID-19.
. Petroleum production for the 2021 financial year was slightly above
guidance. Full year production guidance for copper, iron ore, metallurgical
coal and nickel were delivered, as was revised guidance for energy coal.
. Full year unit cost guidance/(1)/ expected to be achieved for WAIO,
Escondida and Queensland Coal (based on exchange rates of AUD/USD 0.70 and
USD/CLP 769). Petroleum unit costs are expected to be slightly better than
guidance. New South Wales Energy Coal (NSWEC) unit costs are expected to be
marginally above guidance.
. During the year, we successfully achieved first production at four major
development projects, all of which were delivered on or ahead of schedule
and on budget. The South Flank iron ore project in Western Australia and
the Ruby oil and gas project in Trinidad and Tobago both achieved first
production in May 2021. The Atlantis Phase 3 petroleum project and the
Spence Growth Option copper project achieved first production in the first
half of the 2021 financial year.
. In exploration, we have continued to add to our early stage options in
future facing commodities throughout the year, with the signing of an
agreement for a nickel exploration alliance in Canada and of a farm-in
agreement for the Elliott copper project in Australia. At Oak Dam in South
Australia, next stage resource definition drilling to inform future design
commenced in May 2021.
. The financial results for the second half of the 2021 financial year are
expected to reflect certain items as summarised in the table on page 3.
FY21 Jun Q21
Production (vs FY20) (vs Mar Q21) Jun Q21 vs Mar Q21 commentary
---------- ----------- ------------ -----------------------------
Petroleum (MMboe)............. 102.8 27.0 Increased volumes due to higher seasonal demand at Bass Strait
(6%) 6% and improved uptime at Atlantis.
Copper (kt)................... 1,635.7 403.0 Higher volumes as a result of the ongoing ramp up of concentrate
(5%) 3% production at Spence following first production at the Spence Growth
Option in December 2020.
Iron ore (Mt)................. 253.5 65.2 Increased volumes at WAIO reflects record quarterly production at Mining
2% 9% Area C, which included first ore from South Flank in May 2021, and
continued strong operational performance enabled by improved supply
chain reliability.
Metallurgical coal (Mt)....... 40.6 11.8 Higher volumes at Queensland Coal reflects a strong underlying
(1%) 23% operational performance, including record quarterly production at
Goonyella and BMA, following significant wet weather impacts in the
prior period.
Energy coal (Mt).............. 19.3 6.3 Higher volumes at NSWEC due to record wash plant performance and lower
(17%) 31% strip ratios, and significant weather impacts in the prior period.
Nickel (kt)................... 89.0 22.4 Higher volumes due to planned maintenance undertaken in the prior
11% 10% period.
Group copper equivalent production for the 2021 financial year was broadly in
line with the prior year. Group copper equivalent production for the 2022
financial year is expected to be in line with the 2021 financial year despite
continued impacts from a reduction in operational workforces in our Chilean
copper assets in response to COVID-19 and petroleum natural field decline.
--------------------------------------------------------------------------------
BHP Operational Review for 1
the year ended 30 June 2021
Summary
BHP Chief Executive Officer, Mike Henry:
"BHP safely delivered another year of excellent operational performance and its
second consecutive financial year with zero fatalities at our operated assets.
We set several production records and brought on four major projects safely, on
schedule and on budget.
This strong performance is a reflection of the capability and commitment of our
employees and contractors, the strength of our systems and the support of our
business partners.
We achieved production records at our Western Australia Iron Ore operations and
the Goonyella Riverside metallurgical coal mine in Queensland. We maintained
all-time high concentrator throughput at our Escondida copper mine in Chile.
Olympic Dam in South Australia had its highest annual copper production since
BHP acquired the asset in 2005, and its best-ever gold production.
South Flank, the largest and one of the most technically-advanced iron ore mines
in Australia, began production in May and will boost the overall quality of
BHP's iron ore product suite. In the same month, the Ruby project in Trinidad
and Tobago started production. Atlantis Phase 3 in the Gulf of Mexico and the
Spence expansion in Chile began production in the first half of the year.
BHP is in great shape. Our operations are performing well, we continue our track
record of disciplined capital allocation, and our portfolio is positively
leveraged to the megatrends of decarbonisation, electrification and population
growth."
Operational performance
Production and guidance are summarised below.
Note: All guidance is subject to further potential impacts from COVID-19 during
the 2022 financial year.
FY21 Jun Q21 Jun Q21
Jun vs vs vs FY22 FY22e
Production FY21 Q21 FY20 Jun Q20 Mar Q21 guidance vs FY21
---------- ------- ------ ------ ------- ------- ------------- -------------
Petroleum (MMboe)...................... 102.8 27.0 (6%) 2% 6% 99 - 106 (4%) - 3%
Copper (kt)............................ 1,635.7 403.0 (5%) (3%) 3% 1,590 - 1,760 (3%) - 8%
Escondida (kt)...................... 1,068.2 246.7 (10%) (16%) (1%) 1,000 - 1,080 (6%) - 1%
Pampa Norte (kt).................... 218.2 69.4 (10%) 27% 33% 330 - 370 51% - 70%
Olympic Dam (kt).................... 205.3 50.8 20% 7% (8%) 140 - 170 (32%) - (17%)
Antamina (kt)....................... 144.0 36.1 16% 103% 4% 120 - 140 (17%) - (3%)
Iron ore (Mt).......................... 253.5 65.2 2% (2%) 9% 249 - 259 (2%) - 2%
WAIO (Mt)........................... 251.6 64.2 1% (4%) 9% 246 - 255 (2%) - 1%
WAIO (100% basis) (Mt).............. 284.1 72.8 1% (4%) 9% 278 - 288 (2%) - 1%
Samarco (Mt)........................ 1.9 1.0 100% 100% 17% 3 - 4 55% - 106%
Metallurgical coal (Mt)................ 40.6 11.8 (1%) 2% 23% 39 - 44 (4%) - 8%
Queensland Coal (100% basis)(Mt).... 72.5 21.1 0% 2% 22% 70 - 78 (3%) - 8%
Energy coal (Mt)/(i)/.................. 19.3 6.3 (17%) 11% 31% 13 - 15 (33%) - (22%)
NSWEC (Mt).......................... 14.3 4.5 (11%) (8%) 51% 13 - 15 (9%) - 5%
Cerrejon (Mt)/(i)/.................. 5.0 1.8 (30%) 133% (1%) n/a n/a
Nickel (kt)............................ 89.0 22.4 11% (6%) 10% 85 - 95 (4%) - 7%
(i) We will no longer provide production guidance for Cerrejon reflecting the
announced divestment of our interest in June 2021 and volumes will be
reported separately from 1 July 2021 until transaction completion.
--------------------------------------------------------------------------------
BHP Operational Review for 2
the year ended 30 June 2021
Summary of disclosures
BHP expects its financial results for the second half of the 2021 financial year
to reflect certain items as 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 17 August 2021. Accordingly the information
is subject to update.
H2 FY21
impact
Description US$M/(i)/ Classification/(ii)/
----------- ---------- ----------------------------------
Unit costs for WAIO, Escondida and Queensland Coal are expected to be in Operating costs
line with full year guidance (at guidance exchange rates), with Escondida
tracking towards the low end of guidance and WAIO tracking towards the
upper end of guidance
Note: stronger Australian dollar and Chilean peso than guidance rates in
the period/(iii)/
-----------------------------------------------------------------------------------------------------------------------------------
Petroleum unit costs are expected to be slightly better than full year (Down Arrow) Operating costs
guidance driven by higher than expected volumes
-----------------------------------------------------------------------------------------------------------------------------------
NSWEC unit costs are expected to be marginally above full year guidance (Up Arrow) Operating costs
largely as a result of lower volumes due to significant weather impacts
and an increased proportion of washed coal in response to widening price
quality differentials, consistent with our strategy to focus on higher
quality products
-----------------------------------------------------------------------------------------------------------------------------------
Increase in closure and rehabilitation provision for closed mines 375 - 425 (Up Arrow) Operating costs
(reported in group and unallocated, approximately 75 per cent of the
increase) and closed sites at Petroleum and WAIO
-----------------------------------------------------------------------------------------------------------------------------------
Business development and evaluation expense for Petroleum 90 Development and evaluation expense
-----------------------------------------------------------------------------------------------------------------------------------
Exploration expense (including petroleum and minerals exploration 430 Exploration expense
programs)
-----------------------------------------------------------------------------------------------------------------------------------
Higher depreciation and amortisation mainly at Yandi (due to a decrease 450 - 500 (Up Arrow) Depreciation,
in life of mine) and Bass Strait (due to a decrease in estimated reserves) amortisation and impairments
-----------------------------------------------------------------------------------------------------------------------------------
The Group's adjusted effective tax rate for FY21 is expected to be within Taxation expense
the guidance range of 32 to 37 per cent
-----------------------------------------------------------------------------------------------------------------------------------
Dividends paid to non-controlling interests ~1,400 (Up Arrow) Financing cash outflow
-----------------------------------------------------------------------------------------------------------------------------------
Impairment charge related to the announced divestment of Cerrejon (after tax) ~85 (Up Arrow) Exceptional item charge
-----------------------------------------------------------------------------------------------------------------------------------
Costs directly attributable to COVID-19 (after tax)/(iv)/ 150 - 200 (Up Arrow) Exceptional item charge
-----------------------------------------------------------------------------------------------------------------------------------
Financial impact on BHP Brasil of the Samarco dam failure Refer footnote/(v)/ (Up Arrow) Exceptional item charge
-----------------------------------------------------------------------------------------------------------------------------------
(i) Numbers are not tax effected, unless otherwise noted.
(ii) There will be a corresponding balance sheet, cash flow and/or income
statement impact as relevant.
(iii) Average exchange rates for FY21 of AUD/USD 0.75 (guidance rate AUD/USD
0.70) and USD/CLP 746 (guidance rate USD/CLP 769).
(iv) Relates to additional costs incurred at our operated assets for the
increased provision of health and hygiene services and the impacts of
maintaining social distancing requirements. For example, additional
accommodation and cleaning costs at the Spence Growth Option project and
additional port costs at WAIO due to quarantine restrictions.
(v) Financial impact is the subject of ongoing work and is not yet finalised.
Major development projects
During the year, we successfully achieved first production at four major
development projects, all of which were delivered on or ahead of schedule and on
budget.
The Atlantis Phase 3 petroleum project and the Spence Growth Option copper
project achieved first production in the first half of the 2021 financial year.
During the June 2021 quarter, the South Flank iron ore sustaining project in
Western Australia and the Ruby oil and gas project in Trinidad and Tobago
achieved first production. Given this, South Flank and Ruby project progress
will not be reported in future Operational Reviews.
At the end of the 2021 financial year, BHP had two major projects under
development in petroleum (Mad Dog Phase 2) and potash (Jansen mine shafts), with
both of these tracking to plan.
The Jansen Stage 1 project in Canada remains on track for a go or no-go decision
in the next two months.
--------------------------------------------------------------------------------
BHP Operational Review for 3
the year ended 30 June 2021
Corporate update
On 28 June 2021, BHP announced that it had signed a Sale and Purchase Agreement
with Glencore to divest its 33.3 per cent interest in Cerrejon, a non-operated
energy coal joint venture in Colombia, for US$294 million cash consideration.
Subject to the satisfaction of customary competition and regulatory
requirements, we expect completion to occur in the second half of the 2022
financial year. The transaction has an effective economic date of 31 December
2020. The purchase price is subject to adjustments at transaction completion,
including for any dividends paid by Cerrejon to BHP during the period from
signing to completion. A further impairment charge related to Cerrejon of
approximately US$85 million post tax will be recognised as an exceptional item
in the financial results for the second half of the 2021 financial year. For the
2021 financial year, BHP will continue to report Cerrejon, including the
impairment charge, in its Income Statement within profit/(loss) from equity
accounted investments. It will continue to be reported within our Coal segment
and asset tables. On the Balance Sheet, it will be reclassified as an asset held
for sale. Beyond the 2021 financial year, BHP expects the sale of Cerrejon to
complete with no net impact on BHP's Income Statement and, as a result, we would
no longer report it in our Coal segment or asset tables.
The broader carrying value assessment of the Group's assets is ongoing with a
particular focus on Jansen and NSWEC, and will be finalised in conjunction with
the release of the financial results on 17 August 2021.
On 9 April 2021, Samarco announced that it filed for judicial reorganisation
(JR) with the Commercial Courts of Belo Horizonte, State of Minas Gerais, Brazil
(JR Court). On 12 April 2021, the JR Court accepted the case and appointed four
judicial administrators. On 5 July 2021, the judicial administrators filed a
revised list of creditors with the JR Court, which kept shareholders' claims as
listed by Samarco, with the Renova Foundation not listed as a creditor. This
excludes the Renova Foundation's funding and programs from the JR. The revised
list of creditors is not final as it is still open to discussion before the JR
court. The JR is a means for Samarco to restructure its financial debts in order
to establish a sustainable independent financial position for Samarco to
continue to rebuild its operations safely and meet its Renova Foundation
obligations. Samarco's filing follows unsuccessful attempts to negotiate a debt
restructure with financial creditors and multiple legal actions filed by those
creditors which threaten Samarco's operations. Samarco's operations will
continue during the JR and restructure process. The JR does not affect Samarco's
obligation or commitment to make full redress for the 2015 Fundao dam failure,
and it does not impact Renova Foundation's ability to undertake that remediation
and compensation.
In addition, negotiations are ongoing with State and Federal Prosecutors and
certain other Brazilian public authorities on the review of the Framework
Agreement. The Framework Agreement was entered into between Samarco, Vale and
BHP Brasil and the relevant Brazilian authorities in March 2016 and established
Foundation Renova to develop and implement environmental and socio-economic
programs to remediate and provide compensation for damage caused by the Samarco
dam failure.
We will provide an update to the ongoing potential financial impacts on BHP
Brasil of the Samarco dam failure with the release of the financial results on
17 August 2021. Any financial impacts will continue to be treated as an
exceptional item.
We have continued to take action to support the reduction of value chain
greenhouse gas emissions. On 21 April 2021, we announced the signing of a
Memorandum of Cooperation to become one of the founding members of the Maritime
Decarbonisation Centre to be set up in Singapore. The Maritime Decarbonisation
Centre will be a focal point for the global maritime industry's efforts in both
decarbonisation and innovation, bringing together experts and the industry,
including start-ups to develop technologies and co-create innovative solutions.
BHP is the only resources company that is part of the alliance.
--------------------------------------------------------------------------------
BHP Operational Review for 4
the year ended 30 June 2021
Average realised prices
The average realised prices achieved for our major commodities are summarised
below.
FY21 Jun H21 Jun H21
vs vs vs
Average realised prices/(i)/ Jun H21 Dec H20 FY21 FY20 FY20 Jun H20 Dec H20
---------------------------- ------- ------- ------- ------ ------ ------- -------
Oil (crude and condensate) (US$/bbl)... 63.05 41.40 52.56 49.53 6% 68% 52%
Natural gas (US$/Mscf)/(ii)/........... 4.86 3.83 4.34 4.04 8% 29% 27%
LNG (US$/Mscf)......................... 7.04 4.45 5.63 7.26 (22%) 2% 58%
Copper (US$/lb)........................ 4.34 3.32 3.81 2.50 52% 82% 31%
Iron ore (US$/wmt, FOB)................ 158.17 103.78 130.56 77.36 69% 106% 52%
Metallurgical coal (US$/t)............. 114.81 97.61 106.64 130.97 (19%) (5%) 18%
Hard coking coal (US$/t)/(iii)/..... 118.54 106.30 112.72 143.65 (22%) (11%) 12%
Weak coking coal (US$/t)/(iii)/..... 104.40 73.17 89.62 92.59 (3%) 24% 43%
Thermal coal (US$/t)/(iv)/............. 70.83 44.35 58.42 57.10 2% 27% 60%
Nickel metal (US$/t)................... 17,537 15,140 16,250 13,860 17% 41% 16%
(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) Includes internal sales.
(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; excludes Cerrejon. Includes thermal coal sales from
metallurgical coal mines.
The large majority of oil sales were linked to West Texas intermediate (WTI) or
Brent based indices, with differentials applied for quality, locational and
transportation costs. 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 were
based on an average moisture rate of 7.3 per cent. The large majority of
metallurgical coal and energy coal exports were linked to index pricing for the
month of shipment or sold on the spot market at fixed or index-linked prices,
with price differentials reflecting product quality. The 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 2021, the Group had 323 kt of outstanding copper sales that were
revalued at a weighted average price of US$4.25 per pound. The final price of
these sales will be determined in the 2022 financial year. In addition, 304 kt
of copper sales from the 2020 financial year were subject to a finalisation
adjustment in the current period. The provisional pricing and finalisation
adjustments will increase Underlying EBITDA/(2)/ by US$47 million in the 2021
financial year and are included in the average realised copper price in the
above table.
--------------------------------------------------------------------------------
BHP Operational Review for 5
the year ended 30 June 2021
Petroleum
Production
FY21 Jun Q21 Jun Q21
vs vs vs
FY21 Jun Q21 FY20 Jun Q20 Mar Q21
------ ------- ------ ------- -------
Crude oil, condensate and natural gas liquids (MMboe)... 46.0 12.2 (6%) 7% 5%
Natural gas (bcf)....................................... 340.6 88.6 (5%) (1%) 7%
Total petroleum production (MMboe)...................... 102.8 27.0 (6%) 2% 6%
Petroleum - Total petroleum production decreased by six per cent to 103 MMboe,
with volumes slightly above the top end of our guidance range. Production is
expected to be between 99 and 106 MMboe in the 2022 financial year, reflecting a
full year of the additional 28 per cent working interest acquired in Shenzi,
increased production at Shenzi from infill wells and increased volumes from Ruby
following first production in May 2021, offset by natural field decline across
the portfolio.
Crude oil, condensate and natural gas liquids production decreased by six per
cent to 46 MMboe due to natural field decline across the portfolio, a highly
active hurricane season in the Gulf of Mexico in the first half of the year and
downtime at Atlantis, with tie-in activity in the first half of the year and
unplanned downtime in the March 2021 quarter. These impacts were partially
offset by the earlier than scheduled achievement of first production from the
Atlantis Phase 3 project in July 2020 and the additional working interest
acquired in Shenzi, completed on 6 November 2020.
Natural gas production decreased by five per cent to 341 bcf, reflecting planned
shutdowns at Angostura related to the Ruby tie-in, lower gas demand at Bass
Strait and natural field decline across the portfolio. The decline was partially
offset by improved reliability at Bass Strait and higher domestic gas sales at
Macedon.
Projects
Capital Initial
Project and expenditure production
ownership US$M target date Capacity Progress
----------- ----------- ----------- -------------------------------------- ---------------------------------------
Ruby 283 H1 CY21 Five production wells tied back into First production achieved in May 2021,
(Trinidad & Tobago) existing operated processing ahead of schedule and on budget. The
68.46% (operator) facilities, with capacity to produce drilling and completion activities of
up to 16,000 gross barrels of oil per the remaining wells will continue to
day and 80 million gross standard be progressed as part of the planned
cubic feet of natural gas per day. asset activities.
Mad Dog Phase 2 2,154 Mid-CY22 New floating production facility with On schedule and budget.
(US Gulf of Mexico) the capacity to produce up to 140,000 The overall project is 93% complete.
23.9% (non-operator) gross barrels of crude oil per day.
---------------------------------------------------------------------------------------------------------------------------------
The Bass Strait West Barracouta project achieved first production in April 2021,
on schedule and budget.
In May 2021, we completed a transaction with EnVen Energy Ventures, LLC to
transfer our 35 per cent ownership interest in the operated Neptune field in the
Gulf of Mexico.
In the June 2021 quarter, drilling commenced on the second Shenzi infill well.
Drilling of the first Shenzi infill well took place in March 2021, with
production expected from both infill wells in the 2022 financial year. The
successful acquisition of an increased working interest in Shenzi in November
2020 realises further value from the continued Shenzi development.
The Mad Dog Phase 2 project achieved a major milestone in April 2021 as the
semi-submersible floating production platform, Argos, arrived in the US from
South Korea. First production from Mad Dog Phase 2 is expected in the middle of
the 2022 calendar year.
Petroleum exploration
No exploration and appraisal wells were drilled during the June 2021 quarter.
In Trinidad and Tobago, the Transocean drilling rig (Development Driller III)
arrived on location in our Northern licences in June 2021 and is preparing to
commence drilling of two Calypso gas appraisal wells in July 2021.
Petroleum exploration expenditure for the 2021 financial year was US$322
million, of which US$296 million was expensed. Our exploration spend for the
full year is lower than guidance due to changes in appraisal well phasing from
the June 2021 quarter to the September 2021 quarter.
--------------------------------------------------------------------------------
BHP Operational Review for 6
the year ended 30 June 2021
Copper
Production
FY21 Jun Q21 Jun Q21
vs vs vs
FY21 Jun Q21 FY20 Jun Q20 Mar Q21
------- ------- ------- ------- -------
Copper (kt)............ 1,635.7 403.0 (5%) (3%) 3%
Zinc (t)............... 145,089 35,483 64% 158% 7%
Uranium (t)............ 3,267 614 (11%) (40%) (26%)
Copper - Total copper production decreased by five per cent to 1,636 kt.
Production for the 2022 financial year is expected to be between 1,590 and
1,760 kt.
For the 2021 financial year, our Chilean assets operated with a substantial
reduction in their operational workforces as a result of the preventative
measures we implemented to mitigate the impact of COVID-19. In the June 2021
quarter, escalating COVID-19 infections in Chile led to increased pressures on
Chile's health system, which resulted in strict quarantine measures and border
restrictions. We expect the operating environment for our Chilean assets to
remain challenging, with reductions in our on-site workforce forecast to
continue in the 2022 financial year.
Escondida copper production decreased by 10 per cent to 1,068 kt as continued
strong concentrator throughput of 371 ktpd, at record levels, was more than
offset by the impact of expected lower concentrator feed grade and lower cathode
production. This was slightly above the upper end of our increased guidance
range as a result of improved maintenance practices and strong mine equipment
performance. Concentrator throughput continued to be prioritised over cathode
production in the June 2021 quarter as part of an effort to offset the impact of
the reduced operational workforce. Production of between 1,000 and 1,080 kt is
expected for the 2022 financial year and reflects a continuing need to catch up
on mine development due to reduced material movement in the 2021 financial year,
as well as uncertainty around COVID-19 impacts. Decline in the copper grade of
concentrator feed in the 2022 financial year is expected to be approximately two
per cent. Guidance of an annual average of 1.2 Mt of copper production over the
next five years remains unchanged, with production expected to be weighted
towards the latter years.
On 1 April 2021, Escondida successfully completed negotiations for a new
collective agreement that applies to the Intermel Union of Operators and
Maintainers, effective for 24 months from 1 April 2021. Escondida's collective
agreement with Union No1 of Operators and Maintainers expires on 1 August 2021
and negotiations commenced in June 2021.
Pampa Norte copper production decreased by 10 per cent to 218 kt largely due to
a decline in stacking feed grade at Spence of 11 per cent , planned maintenance
at Spence and the impact of a reduced operational workforce as a result of
COVID-19 restrictions. This was slightly lower than guidance due to continued
COVID-19 related impacts on the ramp-up of the Spence Growth Option (SGO).
Production for the 2022 financial year is expected to increase by more than 50
per cent to between 330 and 370 kt, reflecting the continued ramp-up of SGO,
partially offset by a forecast decline in stacking feed grade at Pampa Norte of
approximately nine per cent. The ramp-up to full production capacity at SGO is
still expected to take approximately 12 months from first production in December
2020, following which Spence is forecast to average 300 ktpa of production
(including cathodes) over the first four years of operation.
On 10 June 2021, Spence successfully completed negotiations for a new collective
agreement that applies to the Union of Operators and Maintainers, effective for
36 months from 1 June 2021.
On 7 June 2021, we completed negotiations for an extension of the current
agreement with the Specialists and Supervisors Union of BHP Chile (comprising
mainly employees from the Centre of Integrated Operations in Santiago that
services Escondida and Spence), effective for 18 months from 1 June 2021.
Olympic Dam copper production increased by 20 per cent to 205 kt, the highest
annual production achieved since our acquisition in 2005, reflecting improved
smelter stability and strong underground mine performance. Olympic Dam also
achieved record gold production of 146 koz. Commissioning of the refinery crane
is now complete. Production for the 2022 financial year is expected to decrease
to between 140 and 170 kt as a result of the planned major smelter maintenance
campaign and subsequent ramp up planned between August 2021 and February 2022.
Antamina copper production increased 16 per cent to 144 kt and zinc production
increased 64 per cent to a record 145 kt, reflecting both higher copper and zinc
head grades. Copper production of between 120 and 140 kt, and zinc production of
between 115 and 130 kt is expected for the 2022 financial year.
--------------------------------------------------------------------------------
BHP Operational Review for 7
the year ended 30 June 2021
Iron Ore
Production
FY21 Jun Q21 Jun Q21
vs vs vs
FY21 Jun Q21 FY20 Jun Q20 Mar Q21
------- ------- ------- ------- -------
Iron ore production (kt)....... 253,534 65,245 2% (2%) 9%
Iron ore - Total iron ore production increased by two per cent to 254 Mt.
Production of between 249 and 259 Mt is expected in the 2022 financial year.
WAIO production increased by one per cent to a record 252 Mt (284 Mt on a 100
per cent basis), reflecting record production at Jimblebar and Mining Area C,
which included first ore from South Flank in May 2021. This was achieved despite
significant weather impacts, temporary rail labour shortages due to COVID-19
related border restrictions and the planned Mining Area C and South Flank major
tie-in activity. Strong operational performance across the supply chain
reflected continued improvements in car dumper performance and reliability, and
train cycle times.
Yandi resource has commenced its end-of-life ramp-down as South Flank ramps up,
and is expected to continue to provide supply chain flexibility with a lower
level of production to continue for a few years.
Production of between 246 and 255 Mt (278 and 288 Mt on a 100 per cent basis) is
expected for the 2022 financial year as WAIO continues to focus on incremental
volume growth through productivity improvements. We continue with our program to
further improve port reliability and this includes a major maintenance campaign
on car dumper one planned for the September 2021 quarter.
Samarco production was 1.9 Mt following the recommencement of iron ore pellet
production at one concentrator in December 2020. Production of between 3 and 4
Mt (BHP share) is expected for the 2022 financial year. Production capacity of
approximately 8 Mtpa (100 per cent basis) is expected to be reached in the
second half of the 2022 financial year.
Projects
Capital Initial
Project and expenditure production
ownership US$M target date Capacity Progress
----------- ----------- ----------- -------------------------------------- ------------------------------------
South Flank............ 3,061 Mid-CY21 Sustaining iron ore mine to replace First production achieved in May
(Australia) production from the 80 Mtpa (100 2021, on schedule and on budget.
85% per cent basis) Yandi mine.
South Flank will ramp up to full production capacity of 80 Mtpa (100 per cent
basis) over three years. South Flank's high quality ore will increase WAIO's
average iron ore grade from 61 to 62 per cent, and the overall proportion of
lump from 25 to between 30 and 33 per cent, once fully ramped up.
--------------------------------------------------------------------------------
BHP Operational Review for 8
the year ended 30 June 2021
Coal
Production
FY21 Jun Q21 Jun Q21
vs vs vs
FY21 Jun Q21 FY20 Jun Q20 Mar Q21
------- ------- ------- ------- -------
Metallurgical coal (kt)........ 40,625 11,823 (1%) 2% 23%
Energy coal (kt)............... 19,290 6,276 (17%) 11% 31%
Metallurgical coal - Metallurgical coal production decreased by one per cent to
41 Mt (73 Mt on a 100 per cent basis), in line with original guidance.
Production is expected to be between 39 and 44 Mt (70 and 78 Mt on a 100 per
cent basis) in the 2022 financial year as we expect restrictions on coal imports
into China to remain for a number of years. Production is expected to be
weighted to the second half of the year due to planned wash plant maintenance in
the first half of the year.
At Queensland Coal, strong underlying operational performance, including record
production at Goonyella facilitated by record tonnes from Broadmeadow mine,
was offset by significant wet weather impacts across most operations earlier
in the year, as well as planned wash plant maintenance at Saraji and Caval Ridge
in the first half of the year. At South Walker Creek, despite record stripping,
production decreased as a result of higher strip ratios due to ongoing impacts
from geotechnical constraints and lower yields.
Energy coal - Energy coal production decreased by 17 per cent to 19 Mt.
Production is expected to decrease to between 13 and 15 Mt in the 2022 financial
year, reflecting the announced divestment of our interest in Cerrejon in June
2021 and that Cerrejon volumes will now be separately reported from 1 July 2021
until transaction completion.
NSWEC production decreased by 11 per cent to 14 Mt despite increased stripping.
This decrease reflects significant weather impacts and higher strip ratios, as
well as lower volumes due to an increased proportion of washed coal in response
to widening price quality differentials, consistent with our strategy to focus
on higher quality products, and reduced port capacity following damage to a
shiploader at the Newcastle port in November 2020. The shiploader is expected to
be back in operation during the September 2021 quarter. Production is expected
to be between 13 and 15 Mt in the 2022 financial year reflecting a continued
focus on higher quality products.
Cerrejon production decreased by 30 per cent to 5 Mt mainly as a result of a
91-day strike in the first half of the year and subsequent delays to the restart
of production, as well as the impact of a reduced operational workforce due to
COVID-19 restrictions. On 28 June 2021, BHP announced it had signed a Sale and
Purchase Agreement with Glencore to divest its 33.3 per cent interest in
Cerrejon. The transaction has an effective economic date of 31 December 2020.
Subject to the satisfaction of customary competition and regulatory
requirements, we expect completion to occur in the second half of the 2022
financial year.
--------------------------------------------------------------------------------
BHP Operational Review for 9
the year ended 30 June 2021
Other
Nickel production
FY21 Jun Q21 Jun Q21
vs vs vs
FY21 Jun Q21 FY20 Jun Q20 Mar Q21
------- ------- ------- ------- -------
Nickel (kt).................... 89.0 22.4 11% (6%) 10%
Nickel - Nickel West production increased by 11 per cent to 89 kt reflecting
strong performance from the new mines and improved operational stability
following major quadrennial maintenance shutdowns in the prior year. Production
is expected to be between 85 and 95 kt in the 2022 financial year, with planned
maintenance in the September 2021 quarter. First production from the Nickel Sulphate
plant expected in the September 2021 quarter.
Potash - Final negotiations on the port solution are progressing. The Jansen
Stage 1 project in Canada remains on track for a go or no-go decision in the
next two months.
Potash project
Project and Investment
ownership US$M Scope Progress
----------- ---------- ------------------------------------------------- ------------------------------------------
Jansen Potash......... 2,972 Investment to finish the excavation and lining of The project is 93% complete.
(Canada) the production and service shafts, and to
100% continue the installation of essential surface
infrastructure and utilities.
Minerals exploration
Minerals exploration expenditure for the 2021 financial year was US$192 million,
of which US$134 million was expensed. Greenfield minerals exploration is
predominantly focused on advancing copper targets in Chile, Ecuador, Mexico,
Peru, Canada, Australia and the south-west United States, and nickel targets are
being advanced in Canada and Australia.
We have continued to add to our early stage options in future facing commodities
throughout the year. We have a signed agreement for a nickel exploration
alliance with Midland Exploration in Canada (August 2020) and we have exercised
our option to sign a farm-in agreement with Encounter Resources for the Elliott
copper project in Australia (May 2021).
Drilling for copper targets is underway in Chile, Ecuador, Peru and the United
States, while further drilling is anticipated for copper and nickel in Australia
during the 2021 calendar year. At Oak Dam in South Australia, next stage
resource definition drilling to inform future design commenced in May 2021.
--------------------------------------------------------------------------------
BHP Operational Review for 10
the year ended 30 June 2021
Variance analysis relates to the relative performance of BHP and/or its
operations during the 2021 financial year compared with the 2020 financial year,
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.
Copper equivalent production based on 2021 financial year average realised
prices.
The following footnotes apply to this Operational Review:
(1) 2021 financial year unit cost guidance: Petroleum US$11-12/boe, Escondida
US$0.95-1.10/lb, WAIO US$13-14/t, Queensland Coal US$74-78/t and
NSWEC US$55-59/t; based on exchange rates of AUD/USD 0.70 and USD/CLP 769.
(2) Underlying EBITDA is used to help assess current operational profitability
excluding the impacts of sunk costs (i.e. depreciation from initial
investment). Underlying EBITDA is earnings before net finance costs,
depreciation, amortisation and impairments, taxation expense, discontinued
operations and exceptional items. Underlying EBITDA includes BHP's share
of profit/(loss) from investments accounted for using the equity method
including net finance costs, depreciation, amortisation and impairments
and taxation expense/(benefit).
The following abbreviations may have been used throughout this report: barrels
(bbl); billion cubic feet (bcf); 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); metre (m); million
barrels of oil equivalent (MMboe); million barrels of oil per day (MMbpd);
million cubic feet per day (MMcf/d); million tonnes (Mt); million tonnes per
annum (Mtpa); ounces (oz); pounds (lb); thousand barrels of oil equivalent
(Mboe); thousand barrels of oil equivalent per day (Mboe/d); thousand ounces
(koz); thousand standard cubic feet (Mscf); 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, BHP Group plc and, except
where the context otherwise requires, their respective subsidiaries as defined
in note 29 'Subsidiaries' in section 5.1 of BHP's 30 June 2020 Annual Report and
Form 20-F. Those terms do not include non-operated assets. 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, Cerrejon, Samarco, Atlantis, Mad Dog, Bass Strait and North West
Shelf. 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 11
the year ended 30 June 2021
Further information on BHP can be found at: bhp.com
Sponsor: UBS South Africa (Pty) Limited
Authorised for lodgement by:
Stephanie Wilkinson
Group Company Secretary
Media Relations Investor Relations
Email: media.relations@bhp.com Email: investor.relations@bhp.com
Australia and Asia Australia and Asia
Gabrielle Notley Tara Dines
Tel: +61 3 9609 3830 Mobile: +61 411 071 715 Tel: +61 3 9609 2222 Mobile: +61 499 249 005
Europe, Middle East and Africa Europe, Middle East and Africa
Neil Burrows James Bell
Tel: +44 20 7802 7484 Mobile: +44 7786 661 683 Tel: +44 20 7802 7144 Mobile: +44 7961 636 432
Americas Americas
Judy Dane Brian Massey
Tel: +1 713 961 8283 Mobile: +1 713 299 5342 Tel: +1 713 296 7919 Mobile: +1 832 870 7677
BHP Group Limited ABN 49 004 028 077 BHP Group plc Registration number 3196209
LEI WZE1WSENV6JSZFK0JC28 LEI 549300C116EOWV835768
Registered in Australia Registered in England and Wales
Registered Office: Level 18, 171 Collins Street Registered Office: Nova South, 160 Victoria Street
Melbourne Victoria 3000 Australia London SW1E 5LB United Kingdom
Tel +61 1300 55 4757 Fax +61 3 9609 3015 Tel +44 20 7802 4000 Fax +44 20 7802 4111
Members of the BHP Group which is
headquartered in Australia
LOGO
Follow us on social media
--------------------------------------------------------------------------------
BHP Operational Review for 12
the year ended 30 June 2021
Production summary
Quarter ended Year to date
------------------------------------ ---------------
Jun Sep Dec Mar Jun Jun Jun
BHP 2020 2020 2020 2021 2021 2021 2020
interest ------ ------- ------- ------ ------ ------- -------
Petroleum /(1)/
Petroleum
Production
Crude oil, condensate and NGL (Mboe)... 11,355 11,507 10,729 11,601 12,205 46,042 48,863
Natural gas (bcf)...................... 89.8 90.9 78.5 82.6 88.6 340.6 359.6
----------------------------------------------------
Total (Mboe)........................... 26,322 26,657 23,812 25,368 26,972 102,809 108,796
----------------------------------------------------
Copper /(2)/
Copper
Payable metal in concentrate (kt)
Escondida /(3)/........................ 57.5% 228.5 236.7 236.7 202.7 195.6 871.7 925.9
Pampa Norte /(4)/...................... 100.0% -- -- 0.7 5.6 21.1 27.4 --
Antamina............................... 33.8% 17.8 34.6 38.6 34.7 36.1 144.0 124.5
----------------------------------------------------
Total.................................. 246.3 271.3 276.0 243.0 252.8 1,043.1 1,050.4
----------------------------------------------------
Cathode (kt)
Escondida /(3)/........................ 57.5% 65.5 47.9 50.9 46.6 51.1 196.5 259.4
Pampa Norte /(4)/...................... 100% 54.5 42.5 53.6 46.4 48.3 190.8 242.7
Olympic Dam............................ 100% 47.6 51.5 47.6 55.4 50.8 205.3 171.6
----------------------------------------------------
Total.................................. 167.6 141.9 152.1 148.4 150.2 592.6 673.7
----------------------------------------------------
------ ------- ------- ------ ------ ------- -------
Total copper (kt)......................... 413.9 413.2 428.1 391.4 403.0 1,635.7 1,724.1
----------------------------------------------------
Lead
Payable metal in concentrate (t)
Antamina............................... 33.8% 262 690 993 468 381 2,532 1,671
----------------------------------------------------
Total.................................. 262 690 993 468 381 2,532 1,671
----------------------------------------------------
Zinc
Payable metal in concentrate (t)
Antamina............................... 33.8% 13,736 34,398 41,909 33,299 35,483 145,089 88,462
----------------------------------------------------
Total.................................. 13,736 34,398 41,909 33,299 35,483 145,089 88,462
----------------------------------------------------
Gold
Payable metal in concentrate (troy oz)
Escondida /(3)/........................ 57.5% 43,422 42,332 47,789 37,954 38,893 166,968 177,422
Olympic Dam (refined gold)............. 100% 34,150 36,608 23,837 37,075 48,478 145,998 145,972
----------------------------------------------------
Total.................................. 77,572 78,940 71,626 75,029 87,371 312,966 323,394
----------------------------------------------------
Silver
Payable metal in concentrate (troy koz)
Escondida /(3)/........................ 57.5% 1,599 1,580 1,627 1,318 1,234 5,759 6,413
Antamina............................... 33.8% 626 1,326 1,767 1,463 1,409 5,965 4,116
Olympic Dam (refined silver)........... 100% 295 157 193 275 185 810 984
----------------------------------------------------
Total.................................. 2,520 3,063 3,587 3,056 2,828 12,534 11,513
----------------------------------------------------
Uranium
Payable metal in concentrate (t)
Olympic Dam............................ 100% 1,016 874 945 834 614 3,267 3,678
----------------------------------------------------
Total.................................. 1,016 874 945 834 614 3,267 3,678
----------------------------------------------------
Molybdenum
Payable metal in concentrate (t)
Antamina............................... 33.8% 243 284 192 276 111 863 1,666
----------------------------------------------------
Total.................................. 243 284 192 276 111 863 1,666
----------------------------------------------------
--------------------------------------------------------------------------------
BHP Operational Review for 13
the year ended 30 June 2021
Production summary
Quarter ended Year to date
------------------------------------ ---------------
Jun Sep Dec Mar Jun Jun Jun
BHP 2020 2020 2020 2021 2021 2021 2020
interest ------ ------- ------- ------ ------ ------- -------
Iron Ore
Iron Ore
Production (kt) /(5)/
Newman................................. 85% 17,110 16,410 17,637 14,614 14,560 63,221 65,641
Area C Joint Venture................... 85% 13,973 11,889 11,567 13,010 15,920 52,386 51,499
Yandi Joint Venture.................... 85% 19,087 17,666 16,413 16,112 18,405 68,596 69,262
Jimblebar /(6)/........................ 85% 16,559 20,075 16,740 15,241 15,337 67,393 61,754
Wheelarra.............................. 85% -- -- -- -- -- -- 3
Samarco................................ 50% -- -- 37 878 1,023 1,938 --
----------------------------------------------------
Total.................................. 66,729 66,040 62,394 59,855 65,245 253,534 248,159
----------------------------------------------------
Coal
Metallurgical coal
Production (kt) /(7)/
BMA.................................... 50% 9,078 7,365 7,539 7,727 9,253 31,884 31,575
BHP Mitsui Coal /(8)/.................. 80% 2,536 2,325 1,983 1,863 2,570 8,741 9,543
----------------------------------------------------
Total.................................. 11,614 9,690 9,522 9,590 11,823 40,625 41,118
----------------------------------------------------
Energy coal
Production (kt)
NSW Energy Coal........................ 100% 4,887 3,624 3,229 2,981 4,492 14,326 16,052
Cerrejon............................... 33.3% 767 1,038 347 1,795 1,784 4,964 7,115
----------------------------------------------------
Total.................................. 5,654 4,662 3,576 4,776 6,276 19,290 23,167
----------------------------------------------------
Other
Nickel
Saleable production (kt)
Nickel West /(9)/...................... 100% 23.9 22.2 24.0 20.4 22.4 89.0 80.1
----------------------------------------------------
Total.................................. 23.9 22.2 24.0 20.4 22.4 89.0 80.1
----------------------------------------------------
Cobalt
Saleable production (t)
Nickel West............................ 100% 312 238 236 273 241 988 775
----------------------------------------------------
Total.................................. 312 238 236 273 241 988 775
----------------------------------------------------
(1) LPG and ethane are reported as natural gas liquids (NGL). Product-specific
conversions are made and NGL is reported in barrels of oil equivalent (boe).
Total boe conversions are based on 6 bcf of natural gas equals 1,000 Mboe.
(2) Metal production is reported on the basis of payable metal.
(3) Shown on a 100% basis. BHP interest in saleable production is 57.5%.
(4) Includes Cerro Colorado and Spence.
(5) Iron ore production is reported on a wet tonnes basis.
(6) Shown on a 100% basis. BHP interest in saleable production is 85%.
(7) Metallurgical coal production is reported on the basis of saleable product.
Production figures include some thermal coal.
(8) Shown on a 100% basis. BHP interest in saleable production is 80%.
(9) Production restated to include other nickel by-products.
Throughout this report figures in italics indicate that this figure has been
adjusted since it was previously reported.
--------------------------------------------------------------------------------
BHP Operational Review for 14
the year ended 30 June 2021
Production and sales report
Quarter ended Year to date
------------------------------------------- ----------------
Jun Sep Dec Mar Jun Jun Jun
2020 2020 2020 2021 2021 2021 2020
------- ------- ------- ------- ------- ------- -------
Petroleum /(1)/
Bass Strait
Crude oil and condensate....................... (Mboe) 1,231 1,305 1,003 859 1,205 4,372 4,993
NGL............................................ (Mboe) 1,493 1,660 1,057 1,035 1,563 5,315 5,666
Natural gas.................................... (bcf) 28.1 34.1 23.4 22.7 32.8 113.0 110.9
------- ------- ------- ------- ------- ------- -------
Total petroleum products....................... (Mboe) 7,408 8,648 5,960 5,677 8,235 28,520 29,149
------- ------- ------- ------- ------- ------- -------
North West Shelf
Crude oil and condensate....................... (Mboe) 1,260 1,215 1,180 1,183 933 4,511 5,239
NGL............................................ (Mboe) 203 162 165 188 177 692 796
Natural gas.................................... (bcf) 35.2 29.6 30.4 31.1 26.5 117.6 135.2
------- ------- ------- ------- ------- ------- -------
Total petroleum products....................... (Mboe) 7,334 6,310 6,412 6,554 5,527 24,803 28,569
------- ------- ------- ------- ------- ------- -------
Pyrenees
Crude oil and condensate....................... (Mboe) 971 837 826 679 690 3,032 3,801
------- ------- ------- ------- ------- ------- -------
Total petroleum products....................... (Mboe) 971 837 826 679 690 3,032 3,801
------- ------- ------- ------- ------- ------- -------
Other Australia /(2)/
Crude oil and condensate....................... (Mboe) 1 1 1 1 -- 3 11
Natural gas.................................... (bcf) 11.9 12.7 12.6 12.4 12.6 50.3 46.5
------- ------- ------- ------- ------- ------- -------
Total petroleum products....................... (Mboe) 1,987 2,118 2,101 2,068 2,100 8,387 7,770
------- ------- ------- ------- ------- ------- -------
Atlantis /(3)/
Crude oil and condensate....................... (Mboe) 2,223 2,421 2,385 2,590 3,117 10,513 11,276
NGL............................................ (Mboe) 54 154 147 171 218 690 669
Natural gas.................................... (bcf) 1.1 1.2 1.1 1.4 1.6 5.3 5.6
------- ------- ------- ------- ------- ------- -------
Total petroleum products....................... (Mboe) 2,456 2,775 2,715 2,994 3,602 12,086 12,880
------- ------- ------- ------- ------- ------- -------
Mad Dog /(3)/
Crude oil and condensate....................... (Mboe) 1,297 1,211 930 1,209 1,099 4,449 4,867
NGL............................................ (Mboe) 33 48 38 57 77 220 189
Natural gas.................................... (bcf) 0.3 0.2 0.1 0.2 0.2 0.7 0.9
------- ------- ------- ------- ------- ------- -------
Total petroleum products....................... (Mboe) 1,374 1,292 985 1,299 1,209 4,785 5,195
------- ------- ------- ------- ------- ------- -------
Shenzi /(3)/ /(4)/
Crude oil and condensate....................... (Mboe) 1,584 1,395 1,764 2,328 2,023 7,510 6,245
NGL............................................ (Mboe) 40 71 87 130 87 375 298
Natural gas.................................... (bcf) 0.4 0.3 0.3 0.4 0.1 1.1 1.2
------- ------- ------- ------- ------- ------- -------
Total petroleum products....................... (Mboe) 1,686 1,516 1,901 2,525 2,127 8,069 6,740
------- ------- ------- ------- ------- ------- -------
Trinidad/Tobago
Crude oil and condensate....................... (Mboe) 72 102 96 139 236 573 510
Natural gas.................................... (bcf) 12.8 12.8 10.5 14.4 14.7 52.4 58.9
------- ------- ------- ------- ------- ------- -------
Total petroleum products....................... (Mboe) 2,201 2,235 1,846 2,539 2,686 9,306 10,319
------- ------- ------- ------- ------- ------- -------
Other Americas /(3)/ /(5)/
Crude oil and condensate....................... (Mboe) 198 212 190 187 104 693 957
NGL............................................ (Mboe) 5 2 11 -- 8 21 33
Natural gas.................................... (bcf) -- -- 0.1 -- 0.1 0.2 0.4
------- ------- ------- ------- ------- ------- -------
Total petroleum products....................... (Mboe) 209 214 218 187 129 748 1,059
------- ------- ------- ------- ------- ------- -------
Algeria
Crude oil and condensate....................... (Mboe) 690 711 849 845 668 3,073 3,313
------- ------- ------- ------- ------- ------- -------
Total petroleum products....................... (Mboe) 690 711 849 845 668 3,073 3,313
------- ------- ------- ------- ------- ------- -------
--------------------------------------------------------------------------------
BHP Operational Review for 15
the year ended 30 June 2021
Production and sales report
Quarter ended Year to date
------------------------------------------- ----------------
Jun Sep Dec Mar Jun Jun Jun
2020 2020 2020 2021 2021 2021 2020
------- ------- ------- ------- ------- ------- -------
Petroleum /(1)/
Total production
Crude oil and condensate....................... (Mboe) 9,527 9,410 9,224 10,020 10,075 38,729 41,212
NGL............................................ (Mboe) 1,828 2,097 1,505 1,581 2,130 7,313 7,651
Natural gas.................................... (bcf) 89.8 90.9 78.5 82.6 88.6 340.6 359.6
------- ------- ------- ------- ------- ------- -------
Total.......................................... (Mboe) 26,322 26,657 23,812 25,368 26,972 102,809 108,796
------- ------- ------- ------- ------- ------- -------
(1) Total boe conversions are based on 6 bcf of natural gas equals 1,000 Mboe.
Negative production figures represent finalisation adjustments.
(2) Other Australia includes Minerva and Macedon. Minerva ceased production in
September 2019.
(3) Gulf of Mexico volumes are net of royalties.
(4) BHP completed the acquisition of an additional 28% working interest in
Shenzi on 6 November 2020, taking its total working interest to 72%.
(5) Other Americas includes Neptune, Genesis and Overriding Royalty Interest.
--------------------------------------------------------------------------------
BHP Operational Review for 16
the year ended 30 June 2021
Production and sales report
Quarter ended Year to date
------------------------------------------- ----------------
Jun Sep Dec Mar Jun Jun Jun
2020 2020 2020 2021 2021 2021 2020
------- ------- ------- ------- ------- ------- -------
Copper
Metals production is payable metal unless otherwise stated.
Escondida, Chile /(1)/
Material mined.................................... (kt) 75,062 83,357 97,274 95,978 104,043 380,652 383,413
Sulphide ore milled............................... (kt) 34,755 34,733 36,303 32,654 31,903 135,593 135,810
Average concentrator head grade................... (%) 0.81% 0.85% 0.83% 0.78% 0.77% 0.81% 0.84%
Production ex mill................................ (kt) 236.8 243.9 246.1 207.8 202.8 900.6 957.9
Production
Payable copper.................................... (kt) 228.5 236.7 236.7 202.7 195.6 871.7 925.9
Copper cathode (EW)............................... (kt) 65.5 47.9 50.9 46.6 51.1 196.5 259.4
- Oxide leach.................................... (kt) 26.8 15.3 18.0 16.1 14.5 63.9 106.3
- Sulphide leach................................. (kt) 38.7 32.6 32.9 30.5 36.6 132.6 153.1
------- ------- ------- ------- ------- ------- -------
Total copper...................................... (kt) 294.0 284.6 287.6 249.3 246.7 1,068.2 1,185.3
------- ------- ------- ------- ------- ------- -------
Payable gold concentrate.......................... (troy oz) 43,422 42,332 47,789 37,954 38,893 166,968 177,422
Payable silver concentrate........................ (troy koz) 1,599 1,580 1,627 1,318 1,234 5,759 6,413
Sales
Payable copper.................................... (kt) 221.0 237.1 244.3 196.9 194.1 872.4 903.5
Copper cathode (EW)............................... (kt) 72.1 46.5 47.7 49.6 49.6 193.4 260.9
Payable gold concentrate.......................... (troy oz) 43,422 42,332 47,789 37,954 38,893 166,968 177,422
Payable silver concentrate........................ (troy koz) 1,599 1,580 1,627 1,318 1,234 5,759 6,413
(1) Shown on a 100% basis. BHP interest in saleable production is 57.5%.
Pampa Norte, Chile
Cerro Colorado
Material mined.................................... (kt) 15,734 12,618 6,750 6,153 5,498 31,019 67,617
Ore milled........................................ (kt) 4,553 4,036 3,562 3,283 3,702 14,583 18,131
Average copper grade.............................. (%) 0.60% 0.66% 0.58% 0.58% 0.58% 0.60% 0.56%
Production
Copper cathode (EW)............................... (kt) 16.9 15.8 15.8 13.9 14.7 60.2 67.5
Sales
Copper cathode (EW)............................... (kt) 18.7 14.6 16.6 13.2 15.4 59.8 67.3
Spence
Material mined.................................... (kt) 24,082 18,260 18,485 19,195 21,262 77,202 91,558
Ore milled /(1)/.................................. (kt) 2,829 4,408 6,809 8,007 9,538 28,762 18,788
Average copper grade /(2)/........................ (%) 0.95% 1.10% 0.76% 0.62% 0.67% 0.74% 0.91%
Production
Payable copper.................................... (kt) -- -- 0.7 5.6 21.1 27.4 --
Copper cathode (EW)............................... (kt) 37.6 26.7 37.8 32.5 33.6 130.6 175.2
Sales
Payable copper.................................... (kt) -- -- -- 1.8 20.8 22.6 --
Copper cathode (EW)............................... (kt) 41.0 24.1 40.9 30.7 34.1 129.8 176.8
(1) June 2021 quarter comprised of concentrator throughput of 4,929 kt and cathode throughput of 4,609 kt.
June 2021 year to date comprised of concentrator throughput of 8,607 kt and cathode throughput of 20,155 kt.
(2) June 2021 quarter weighted average of concentrate grade of 0.63% and cathode grade of 0.72%.
June 2021 year to date weighted average of concentrate grade of 0.59% and cathode grade of 0.81%.
--------------------------------------------------------------------------------
BHP Operational Review for 17
the year ended 30 June 2021
Production and sales report
Quarter ended Year to date
------------------------------------------- ----------------
Jun Sep Dec Mar Jun Jun Jun
2020 2020 2020 2021 2021 2021 2020
------- ------- ------- ------- ------- ------- -------
Copper (continued)
Metals production is payable metal unless otherwise stated.
Antamina, Peru
Material mined (100%)............................. (kt) 13,975 45,458 57,029 53,762 63,393 219,642 189,370
Sulphide ore milled (100%)........................ (kt) 6,736 13,202 14,083 12,651 13,466 53,402 46,400
Average head grades
- Copper.......................................... (%) 0.91% 0.94% 0.97% 0.94% 0.93% 0.95% 0.94%
- Zinc............................................ (%) 1.02% 1.30% 1.30% 1.16% 1.24% 1.25% 0.92%
Production
Payable copper.................................... (kt) 17.8 34.6 38.6 34.7 36.1 144.0 124.5
Payable zinc...................................... (t) 13,736 34,398 41,909 33,299 35,483 145,089 88,462
Payable silver.................................... (troy koz) 626 1,326 1,767 1,463 1,409 5,965 4,116
Payable lead...................................... (t) 262 690 993 468 381 2,532 1,671
Payable molybdenum................................ (t) 243 284 192 276 111 863 1,666
Sales
Payable copper.................................... (kt) 18.2 33.8 40.7 31.7 37.3 143.5 125.7
Payable zinc...................................... (t) 11,680 32,769 45,109 34,141 32,044 144,063 86,691
Payable silver.................................... (troy koz) 581 1,310 1,728 1,342 1,540 5,920 3,746
Payable lead...................................... (t) 188 748 945 689 556 2,938 1,615
Payable molybdenum................................ (t) 223 392 352 192 268 1,204 1,327
Olympic Dam, Australia
Material mined /(1)/.............................. (kt) 1,963 2,203 2,379 1,979 2,143 8,704 8,707
Ore milled........................................ (kt) 2,454 2,443 2,377 2,238 2,429 9,487 8,985
Average copper grade.............................. (%) 2.13% 2.03% 2.01% 2.02% 1.95% 2.00% 2.27%
Average uranium grade............................. (kg/t) 0.60 0.53 0.60 0.61 0.56 0.57 0.66
Production
Copper cathode (ER and EW)........................ (kt) 47.6 51.5 47.6 55.4 50.8 205.3 171.6
Payable uranium................................... (t) 1,016 874 945 834 614 3,267 3,678
Refined gold...................................... (troy oz) 34,150 36,608 23,837 37,075 48,478 145,998 145,972
Refined silver.................................... (troy koz) 295 157 193 275 185 810 984
Sales
Copper cathode (ER and EW)........................ (kt) 48.5 49.5 46.6 55.6 52.7 204.4 171.0
Payable uranium................................... (t) 1,293 859 999 779 907 3,544 3,411
Refined gold...................................... (troy oz) 37,743 36,054 21,390 38,852 47,300 143,596 151,279
Refined silver.................................... (troy koz) 270 222 165 242 245 874 981
(1) Material mined refers to underground ore mined, subsequently hoisted or
trucked to surface.
--------------------------------------------------------------------------------
BHP Operational Review for 18
the year ended 30 June 2021
Production and sales report
Quarter ended Year to date
------------------------------------------- ----------------
Jun Sep Dec Mar Jun Jun Jun
2020 2020 2020 2021 2021 2021 2020
------- ------- ------- ------- ------- ------- -------
Iron Ore
Iron ore production and sales are reported on a wet tonnes basis.
Western Australia Iron Ore, Australia
Production
Newman............................................ (kt) 17,110 16,410 17,637 14,614 14,560 63,221 65,641
Area C Joint Venture.............................. (kt) 13,973 11,889 11,567 13,010 15,920 52,386 51,499
Yandi Joint Venture............................... (kt) 19,087 17,666 16,413 16,112 18,405 68,596 69,262
Jimblebar /(1)/................................... (kt) 16,559 20,075 16,740 15,241 15,337 67,393 61,754
Wheelarra......................................... (kt) -- -- -- -- -- -- 3
------- ------- ------- ------- ------- ------- -------
Total production.................................. (kt) 66,729 66,040 62,357 58,977 64,222 251,596 248,159
------- ------- ------- ------- ------- ------- -------
Total production (100%)........................... (kt) 75,589 74,152 70,407 66,695 72,848 284,102 281,058
------- ------- ------- ------- ------- ------- -------
Sales
Lump.............................................. (kt) 17,252 17,056 16,703 15,593 16,410 65,762 63,636
Fines............................................. (kt) 50,904 48,390 46,124 42,939 48,837 186,290 186,962
------- ------- ------- ------- ------- ------- -------
Total............................................. (kt) 68,156 65,446 62,827 58,532 65,247 252,052 250,598
------- ------- ------- ------- ------- ------- -------
Total sales (100%)................................ (kt) 77,048 73,355 70,772 66,032 73,712 283,871 283,259
------- ------- ------- ------- ------- ------- -------
(1) Shown on a 100% basis. BHP interest in saleable production is 85%.
Samarco, Brazil /(1)/
Production........................................ (kt) -- -- 37 878 1,023 1,938 --
Sales............................................. (kt) -- -- -- 646 1,052 1,698 --
(1) Samarco commenced iron ore pellet production in December 2020 after meeting
the licencing requirements to restart operations at the Germano complex in
Minas Gerais and Ubu complex in Espirito Santo, Brazil.
--------------------------------------------------------------------------------
BHP Operational Review for 19
the year ended 30 June 2021
Production and sales report
Quarter ended Year to date
------------------------------------------- ----------------
Jun Sep Dec Mar Jun Jun Jun
2020 2020 2020 2021 2021 2021 2020
------- ------- ------- ------- ------- ------- -------
Coal
Coal production is reported on the basis of saleable product.
Queensland Coal, Australia
Production /(1)/
BMA
Blackwater........................................ (kt) 1,703 1,184 1,737 1,416 1,887 6,224 5,545
Goonyella......................................... (kt) 2,651 2,312 2,152 2,232 2,752 9,448 8,765
Peak Downs........................................ (kt) 1,635 1,487 1,213 1,595 1,597 5,892 5,783
Saraji............................................ (kt) 1,399 817 1,043 1,238 1,391 4,489 4,963
Daunia............................................ (kt) 588 490 464 496 478 1,928 2,170
Caval Ridge....................................... (kt) 1,102 1,075 930 750 1,148 3,903 4,349
------- ------- ------- ------- ------- ------- -------
Total BMA......................................... (kt) 9,078 7,365 7,539 7,727 9,253 31,884 31,575
------- ------- ------- ------- ------- ------- -------
Total BMA (100%).................................. (kt) 18,156 14,730 15,078 15,454 18,506 63,768 63,150
------- ------- ------- ------- ------- ------- -------
BHP Mitsui Coal /(2)/
South Walker Creek................................ (kt) 1,264 1,238 1,118 1,031 1,500 4,887 5,415
Poitrel........................................... (kt) 1,272 1,087 865 832 1,070 3,854 4,128
------- ------- ------- ------- ------- ------- -------
Total BHP Mitsui Coal............................. (kt) 2,536 2,325 1,983 1,863 2,570 8,741 9,543
------- ------- ------- ------- ------- ------- -------
------- ------- ------- ------- ------- ------- -------
Total Queensland Coal............................. (kt) 11,614 9,690 9,522 9,590 11,823 40,625 41,118
------- ------- ------- ------- ------- ------- -------
Total Queensland Coal (100%)...................... (kt) 20,692 17,055 17,061 17,317 21,076 72,509 72,693
------- ------- ------- ------- ------- ------- -------
Sales
BMA
Coking coal....................................... (kt) 7,547 6,187 6,531 6,752 7,801 27,271 27,701
Weak coking coal.................................. (kt) 1,040 977 936 1,038 1,069 4,020 3,289
Thermal coal...................................... (kt) 183 58 3 206 400 667 531
------- ------- ------- ------- ------- ------- -------
Total BMA......................................... (kt) 8,770 7,222 7,470 7,996 9,270 31,958 31,521
------- ------- ------- ------- ------- ------- -------
Total BMA (100%).................................. (kt) 17,540 14,444 14,940 15,992 18,540 63,916 63,041
------- ------- ------- ------- ------- ------- -------
BHP Mitsui Coal /(2)/
Coking coal....................................... (kt) 778 671 604 357 535 2,167 2,782
Weak coking coal.................................. (kt) 1,756 1,545 1,518 1,404 2,027 6,494 6,783
------- ------- ------- ------- ------- ------- -------
Total BHP Mitsui Coal............................. (kt) 2,534 2,216 2,122 1,761 2,562 8,661 9,565
------- ------- ------- ------- ------- ------- -------
------- ------- ------- ------- ------- ------- -------
Total Queensland Coal............................. (kt) 11,304 9,438 9,592 9,757 11,832 40,619 41,086
------- ------- ------- ------- ------- ------- -------
Total Queensland Coal (100%)...................... (kt) 20,074 16,660 17,062 17,753 21,102 72,577 72,606
------- ------- ------- ------- ------- ------- -------
(1) Production figures include some thermal coal.
(2) Shown on a 100% basis. BHP interest in saleable production is 80%.
NSW Energy Coal, Australia
Production........................................ (kt) 4,887 3,624 3,229 2,981 4,492 14,326 16,052
Sales
Export thermal coal............................... (kt) 4,871 3,168 3,940 2,827 4,691 14,626 15,301
Inland thermal coal /(1)/......................... (kt) -- -- -- -- -- -- 567
------- ------- ------- ------- ------- ------- -------
Total............................................. (kt) 4,871 3,168 3,940 2,827 4,691 14,626 15,868
------- ------- ------- ------- ------- ------- -------
(1) The domestic sales contract ended in the September 2019 quarter.
Cerrejon, Colombia
Production........................................ (kt) 767 1,038 347 1,795 1,784 4,964 7,115
Sales thermal coal - export....................... (kt) 1,143 994 370 1,746 1,619 4,729 7,501
--------------------------------------------------------------------------------
BHP Operational Review for 20
the year ended 30 June 2021
Production and sales report
Quarter ended Year to date
------------------------------------------- ----------------
Jun Sep Dec Mar Jun Jun Jun
2020 2020 2020 2021 2021 2021 2020
------- ------- ------- ------- ------- ------- -------
Other
Nickel production is reported on the basis of saleable product
Nickel West, Australia
Mt Keith
Nickel concentrate................................ (kt) 60.2 64.4 55.7 54.1 50.4 224.6 178.2
Average nickel grade.............................. (%) 16.5 15.8 14.7 13.3 13.3 14.4 16.9
Leinster
Nickel concentrate................................ (kt) 72.0 66.2 72.8 71.5 71.4 281.9 253.6
Average nickel grade.............................. (%) 10.2 9.0 9.5 10.2 10.5 9.8 9.7
Saleable production
Refined nickel /(1)//(2)/......................... (kt) 20.5 17.3 20.4 15.2 17.1 70.0 65.6
Intermediates and nickel by-products /(1)//(3)/... (kt) 3.4 4.9 3.6 5.2 5.3 19.0 14.5
------- ------- ------- ------- ------- ------- -------
Total nickel /(1)/................................ (kt) 23.9 22.2 24.0 20.4 22.4 89.0 80.1
------- ------- ------- ------- ------- ------- -------
Cobalt by-products................................ (t) 312 238 236 273 241 988 775
Sales
Refined nickel /(1)//(2)/......................... (kt) 19.7 17.1 20.9 15.0 17.8 70.8 64.1
Intermediates and nickel by-products /(1)//(3)/... (kt) 4.2 4.6 2.6 5.9 4.0 17.1 15.5
------- ------- ------- ------- ------- ------- -------
Total nickel /(1)/................................ (kt) 23.9 21.7 23.5 20.9 21.8 87.9 79.6
------- ------- ------- ------- ------- ------- -------
Cobalt by-products................................ (t) 312 238 237 273 241 989 787
(1) Production and sales restated to include other nickel by-products.
(2) High quality refined nickel metal, including briquettes and powder.
(3) Nickel contained in matte and by-product streams.
--------------------------------------------------------------------------------
BHP Operational Review for 21
the year ended 30 June 2021
Date: 20-07-2021 07:05:00
Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
Sharenet Sites 
