BHP Billiton delivers production records

BHP Billiton continues to capitalise on the worldwide boom for commodities by delivering record iron ore output and increased petroleum production during a period of record prices in its June quarter. The world's largest mining company, which is proposing a $US150 billion ($A154 billion) takeover of rival Rio Tinto Ltd, said record production was achieved for seven commodities. BHP Billiton said the record output occurred in an environment where "supply disruptions and input-cost pressures are placing challenges on the industry response to continued strong global demand for commodities". Iron ore production during the three months to June 30, rose 15 per cent to 29.67 million tonnes from the same period in 2007 as the company continued to expand its Pilbara operations in Western Australia. BHP Billiton said full year output from its Pilbara mines were expected to rise by 23 per cent to 137 million tonnes this financial year. Petroleum output increased by 20 per cent to 36.23 million barrels of oil equivalent (mmboe) due to the continued ramp up of projects in Australia and the United States. "The strong production from our existing asset portfolio and our commitment to growth will see BHP Billiton ideally placed to meet the ongoing high demand for natural resources from China and other developing countries," chief commercial officer Alberto Calderon said in a statement. BHP Billiton shares had dropped 11 cents to $38.89 by 1442 AEST. Fat Prophets analyst Gavin Wendt said BHP Billiton was able to maximise output for its key three commodities - petroleum, iron ore and copper - when they were trading at record or near-record prices. Copper output rose by 14 per cent for the quarter to a record 390,700 tonnes, bolstered by the continued ramp up of the Escondida sulfide leach and Spence operations in Chile, and Pinto Valley in the US. However, BHP Billiton said that output from Escondida is expected to decline by about 10 to 15 per cent in the 2009 fiscal year due to lower ore grade. The company said it had discovered a new prospect - Pampa Escondida - near existing infrastructure and processing facilities - which contains an estimated one billion metric tonnes of porphyry style mineralisation. Nickel output fell by 12 per cent to 42,600 tonnes following industrial action in Colombia, wet weather interruptions at Yabulu in Queensland and scheduled maintenance across all operations. Production of metallurgical coal, which is used in the steelmaking process, dropped by 18 per cent to 9.13 million tonnes as the company's Queensland operations recovered from severe flooding after heavy rainfall earlier in the year. Aluminium production continued to be affected by power supply issues in South Africa and was nine per cent lower at 305,000 tonnes. Source: ninemsn