Tag: BHP

BHP is forecasting stronger operating performance in the second half of 2017-18 after turning in what could be described a solid effort in the three and six months to December, except in its key coking coal business in Queensland where production is down, costs certain to rise which could impact earnings.

BHP’s looming sale of its unwanted US shale oil and gas assets will be made into a market place in 2018 that looks tougher than this year, although prices for oil and gas in America could see small gains.

Several times in the past couple of months we have brought your stories about BHP Billiton’s gathering enthusiasm for copper, and its lack of interest in nickel.

Nickel prices may have rebounded nicely this year, but not to many of the world’s big miners are long term holders – certainly BHP Billiton and its big Brazilian rival, Vale, are trying to reduce to exit their involvement in the metal, whose major source of demand is still for stainless steel.

China’s demand, iron ore prices, copper, energy investment, and climate changes were not the most important outcomes from the Australian shareholders’ annual meeting of BHP yesterday.

Reuters reported last week that Arnoud Balhuizen, chief commercial officer at BHP, has said that while 2017 marks a “tipping point” for electric vehicles (in that they have entered the mainstream of metals demand forecasting), in terms of sales, however, the mass move is further off as hybrids and conventional cars stay on the roads for a transition period.

BHP is on the hunt for its next big copper project as a combination of renewables and electric cars boosts demand for key industrial metals like copper, nickel, and less known metals such as lithium and cobalt. Even zinc and lead are getting a boost from demand for batteries of all types.

Shares in BHP Billiton recovered from an early fall yesterday in the wake of the release of the company’s latest production and sales report which revealed a small fall in iron ore output in the three months to September, but a sharp, 14% jump in copper production.

After spending a lot of effort defending its continuing multi-billion dollar investment in the Canadian potash industry, there was news at the weekend that perhaps BHP Billiton isn’t as wedded to total control as it has been making out.

BHP wants to get rid of its controversial US oil and gas shale assets and will do so in the coming year – mind you the pressure from US vulture fund, Elliott Management had little to do with the decision, did it?

BHP Billiton has boosted payout to shareholders by $US1 billion more than it need under its current policy after boosting net profit to $US5.89 billion in the year to June from a loss of $US6.385 billion the year before.

BHP Billiton has made its third big investment decision to expand and extend the life of a major hard rock mining asset in a month. The company revealed last night that it will spend $US2.46 billion on extending the life of a copper mine in Chile by 50 years.

A week before BHP Billiton releases what is expected to be a big rise in annual profit and a higher dividend, US hedge fund Elliott Management says it has raised its stake in BHP Billiton to 5% – but the reason for the rise is unknown except that it generated some publicity yesterday.

Very quietly, BHP has boosted its spending over the next year on its revamp of its huge Olympic Dam mining operations in South Australia to more than $10 million a week.

BHP is looking for a significant surge in earnings (and dividends) for the June 30 year after turning in a June quarter and full year production report that was surprisingly stronger than expected.

BHP reports its 2016-17 production and sales data in less than two weeks and the full year financial results a month later, but one thing you will hear more of is the looming decision on a new multi-billion dollar iron ore mine in the WA Pilbara region that replace its veteran Yandi operation in around 8 years time.

BHP has chosen former Amcor CEO, Ken MacKenzie to succeed Jac Nasser as Chairman from later this year.

Believe it not BHP is looking to invest more in its underperforming West Australian nickel project at Mount Keith.

This is the story many in the business media and the investment industry won’t tell you – but that attack on BHP from a US hedge fund and private equity group has collapsed as it has been forced to significantly recast its ideas.

As expected (especially after Rio Tinto’s ((RIO)) first quarter production report a week ago), BHP Billiton (BHP) has reported a 20% drop in copper production for the quarter and the nine months to the end of March and cut its full-year production guidance by around 18% due to industrial action at its Escondida mine in northern Chile.

BHP Billiton has again dismissed a wide-ranging proposal by shareholder Elliott Advisors to overhaul its corporate strategy and sell off oil interests, saying the measures would not benefit the firm.

Elliott Advisors is all upset that BHP Billiton (BHP) rejected the plan to end the dual company structure, but keep the separate listings in London and Australia and to spin off and float the company’s petroleum business on the New York Stock Exchange.

BHP Billiton (BHP) shares bolted higher yesterday (taking the wider market up by nearly three quarters of a per cent) after a hedge fund released a letter it had sent to the board urging the company to spin off some of its petroleum business and list it on stockmarket.

Coal prices might be rising sharply, boosting of the prices of some miners on the hope of a temporary boost from the shortage of high grade steel making and thermal coal from Central Queensland, but it seems the surge may be losing ist impact if the performance of Whitehaven Coal shares are any guide.

BHP Billiton (BHP) has moved further to exploit the Trion discovery in Mexico in what is a ground-breaking deal for the country and which will BHP become the first foreign company to do a deal with the country to develop hydrocarbon assets.

What a difference a year makes.

Copper took over as the commodity under focus late last week after a strike forced BHP Billiton (BHP) to curtail activity at its huge Escondida mine in Chile and declaring force majeure on contracted shipments.

BHP Billiton’s (BHP) production of iron ore and metallurgical coal for the first half of the 2016-17 financial year is up, but volumes dropped in its petroleum, copper and thermal coal businesses.

BHP Billiton has given the firmest signal yet that it has moved past its shale oil and gas phase in the US with commitments to help fund two major Gulf of Mexico projects worth an estimated $US20 billion.

Suddenly, BHP Billiton (BHP) is bouncy, upbeat and looking forward as world commodity prices, led by coal, and helped by continuing solid prices for iron ore, show more signs of a rebound.

With a missed debt payment hanging over its head and BHP Billiton (BHP) and its Brazilian partner, Vale, still facing massive costs and penalties from the Brazilian government, a game of ‘dare’ has emerged over the future of the Samarco iron ore mine where a disastrous dam collapse late last year devastated villages and the environment, killing people and causing billions of dollars in damage.

Has BHP Billiton (BHP) identified a new gold/copper rush?

BHP Billiton (BHP) has again emphasised the growth options in its petroleum business, continuing its belief that oil and gas (and copper) are the best placed of its areas of interest for expansion in the next few years.

BHP Billiton shares will come under pressure on the ASX this morning after its 50% owned Brazilian iron ore miner, Samarco, missed an interest payment on $US500 million of bonds.

The Samarco mine disaster in Brazil has seen BHP Billiton’s board drop the bonus that would have been paid to CEO, Andrew Mackenzie for the year to June 30. Nineteen people died in the wake of the dam burst and flooding and dozens were injured, Several villages were destroyed and damage in the billions of dollars was caused.

So the big bad BHP news is out, dividends are down, the company’s turned in a loss for the year to June (and a much smaller underlying result) and there’s a bit of gloom and doom about. So what about the next year or two?

As expected, BHP Billiton took a big loss from the cost of the Samarco dam disaster in Brazil late last year, and slashed dividend because of the weaker underlying earnings performance.

As expected BHP Billiton has fallen short of its 2016-17 iron ore production targets but has topped its full year guidance for petroleum, copper and coking coal.

Take a careful look at BHP Billiton (BHP) and US gas and oil prices and wonder if there are better times in the offing for the company’s onshore unconventional oil and gas business in the US which has been a massive loss-making disaster area for the board, management and shareholders in recent years.