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BHP Bhp Group Limited

2,277.00
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Share Name Share Symbol Market Type Share ISIN Share Description
Bhp Group Limited LSE:BHP London Ordinary Share AU000000BHP4 ORD NPV (DI)
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  20.00 0.89% 2,277.00 2,276.50 2,278.00 2,286.50 2,274.50 2,286.00 160,519 11:53:18
Industry Sector Turnover Profit EPS - Basic PE Ratio Market Cap
Crude Petroleum & Natural Gs 54.19B 12.92B 2.5513 17.39 224.66B

BHP Billiton Exploration and Development Report (7345V)

18/01/2012 7:00am

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RNS Number : 7345V

BHP Billiton PLC

17 January 2012

 
 NEWS RELEASE 
 Release Time    IMMEDIATE 
 Date            18 January 2012 
 Number          02/12 
 

BHP BILLITON EXPLORATION AND DEVELOPMENT REPORT

FOR THE QUARTER ENDED 31 DECEMBER 2011

This report covers the Group's exploration and development activities for the December 2011 quarter. Unless otherwise stated, BHP Billiton's interest in the projects referred to in this report is 100 per cent and references to project schedules are based on calendar years.

Development

A focus on high return growth projects, diversified by commodity, geography and market was further reinforced during the December 2011 half year with the approval of projects in the Metallurgical Coal and Energy Coal businesses. BHP Billiton's commitment to its world class growth pipeline now exceeds US$26 billion.

During the December 2011 quarter, BHP Billiton announced the approval of the Caval Ridge mine development and the expansion of the Peak Downs operation which will add high quality export coking coal capacity and future development options for our leading Queensland Coal business. BHP Billiton also approved construction of the Western Australia Iron Ore (WAIO) Orebody 24 mine and the North West Shelf Greater Western Flank-A project.

Pre-commitment expenditure of US$1.2 billion for the first phase of the Olympic Dam Project (Australia) was activated following environmental approval by the Government of South Australia and the Commonwealth and the successful passage of the Indenture agreement through the South Australian Parliament. This funding will facilitate the procurement of long lead time items such as trucks and accommodation, infrastructure development and early site works.

Onshore US drilling and development expenditure in the Petroleum division totalled US$0.9 billion during the December 2011 quarter and US$1.4 billion during the December 2011 half year.

 
                        Share of approved       Initial production      Production capacity 
Project and ownership   capex (US$m)            target date             (100%)                  Quarterly progress 
----------------------  ----------------------  ----------------------  ----------------------  ---------------------- 
Petroleum projects 
----------------------  ----------------------  ----------------------  ----------------------  ---------------------- 
                                                                                                On schedule and 
                                                                                                budget. The overall 
Macedon (Australia)                                                     200 million cubic feet  project is 45% 
71.43% Gas                               1,050  CY13                    gas per day.            complete. 
----------------------  ----------------------  ----------------------  ----------------------  ---------------------- 
                                                                        10,000 bpd condensate 
                                                                        and processing          On revised schedule 
Bass Strait Kipper                                                      capacity of 80 million  and budget. The 
(Australia) 32.5% -                                                     cubic feet gas per      overall project is 88% 
50% Gas/Gas Liquids                        900  CY12(a)                 day.                    complete. 
----------------------  ----------------------  ----------------------  ----------------------  ---------------------- 
                                                                        11,000 bpd condensate 
                                                                        and processing          On revised schedule 
Bass Strait Turrum                                                      capacity of 200         and budget. The 
(Australia) 50%                                                         million cubic feet gas  overall project is 72% 
Gas/Gas Liquids                          1,350  CY13                    per day.                complete. 
----------------------  ----------------------  ----------------------  ----------------------  ---------------------- 
                                                                                                On budget. Steady 
                                                                                                state production 
North West Shelf North                                                                          remains on track for 
Rankin B Gas                                                                                    CY13. The overall 
Compression                                                             2,500 million cubic     project is 85% 
(Australia) 16.67% LNG                     850  CY13                    feet gas per day.       complete. 
North West Shelf                                                        To maintain LNG plant 
Greater Western                                                         throughput from the     Project approved by 
Flank-A (Australia)                                                     North West Shelf        all JV partners in 
16.67% LNG                                 400  CY16                    operations.             December 2011. 
----------------------  ----------------------  ----------------------  ----------------------  ---------------------- 
Minerals projects 
----------------------  ----------------------  ----------------------  ----------------------  ---------------------- 
                                                                                                On revised schedule 
                                                                                                and budget. The 
                                                                                                overall project is 94% 
                                                                                                complete. Marradong 
                                                                                                mine has been 
Worsley Efficiency &                                                                            commissioned and is 
Growth (Australia) 86%                                                  1.1 million tpa of      ramping up to expected 
Alumina                                  2,995  Q1 CY12                 additional alumina.     capacity. 
----------------------  ----------------------  ----------------------  ----------------------  ---------------------- 
                                                                                                In commissioning phase 
                                                                                                with first production 
                                                                                                now expected in Q1 
                                                                        Increases ore           CY12. The overall 
Antamina Expansion                                                      processing capacity to  project 
(Peru) 33.75% Copper                       435  Q1 CY12                 130,000 tpd.            is 79% complete. 
----------------------  ----------------------  ----------------------  ----------------------  ---------------------- 
                                                                        The relocation of the 
                                                                        in-pit crushing and 
                                                                        conveyor 
                                                                        infrastructure          On schedule and 
                                                                        provides access to      budget. The overall 
Escondida Ore Access                                                    higher                  project is 77% 
(Chile) 57.5% Copper                       319  Q2 CY12                 grade ore.              complete. 
----------------------  ----------------------  ----------------------  ----------------------  ---------------------- 
                                                                        Project consists of a 
                                                                        pushback of the 
                                                                        existing Misery open    On schedule and 
EKATI Misery Open Pit                                                   pit which was mined     budget. The overall 
Project (Canada) 80%                                                    from 2001 to            project is 16% 
Diamonds                                   323  CY15                    2005.                   complete. 
----------------------  ----------------------  ----------------------  ----------------------  ---------------------- 
                                                                        Increases mining and 
                                                                        processing capacity to 
                                                                        35 million tpa with 
                                                                        incremental             On schedule and 
WAIO Jimblebar Mine                                                     debottlenecking         budget. The overall 
Expansion (Australia)                                                   opportunities to 55     project is 21% 
96% Iron Ore                          3,300(b)  Q1 CY14                 million tpa.            complete. 
----------------------  ----------------------  ----------------------  ----------------------  ---------------------- 
                                                                        Increases total inner 
                                                                        harbour capacity to 
WAIO Port Hedland                                                       220 million tpa with    On schedule and 
Inner Harbour                                                           debottlenecking         budget. The overall 
Expansion (Australia)                                                   opportunities           project is 42% 
85% Iron Ore                          1,900(b)  H2 CY12                 to 240 million tpa.     complete. 
----------------------  ----------------------  ----------------------  ----------------------  ---------------------- 
WAIO Port Blending and                                                  Optimises resource and  On schedule and 
Rail Yard Facilities                                                    enhances efficiency     budget. The overall 
(Australia) 85% Iron                                                    across the WAIO supply  project is 13% 
Ore                                   1,400(b)  H2 CY14                 chain.                  complete. 
----------------------  ----------------------  ----------------------  ----------------------  ---------------------- 
                                                                        To maintain iron ore 
WAIO Orebody 24                                                         production output from  Approval announced. 
(Australia) 85% Iron                                                    the Newman Joint        See News Release dated 
Ore                                        698  H2 CY12                 Venture operations.     16 November 2011. 
----------------------  ----------------------  ----------------------  ----------------------  ---------------------- 
                                                                        Increases iron ore 
                                                                        pellet production       On schedule and 
Samarco Fourth Pellet                                                   capacity by 8.3         budget. The overall 
Plant (Brazil) 50%                                                      million tpa to 30.5     project is 18% 
Iron Ore                                 1,750  H1 CY14                 million tpa.            complete. 
----------------------  ----------------------  ----------------------  ----------------------  ---------------------- 
                                                                        Greenfield mine 
                                                                        development with 
                                                                        capacity to produce     On schedule and 
                                                                        4.5 million tpa of      budget. The overall 
Daunia (Australia) 50%                                                  export metallurgical    project is 27% 
Metallurgical Coal                         800  CY13                    coal.                   complete. 
----------------------  ----------------------  ----------------------  ----------------------  ---------------------- 
                                                                        Increases productive 
                                                                        capacity by 0.4         On schedule and 
Broadmeadow Life                                                        million tpa and         budget. The overall 
Extension (Australia)                                                   extends life of the     project is 56% 
50%Metallurgical Coal                      450  CY13                    mine by 21 years.       complete. 
----------------------  ----------------------  ----------------------  ----------------------  ---------------------- 
                                                                        Increases port 
                                                                        capacity from 44 
                                                                        million tpa to 55       On schedule and 
Hay Point Stage Three                                                   million tpa and         budget. The overall 
Expansion (Australia)                                                   reduces storm           project is 36% 
50% Metallurgical Coal                1,250(b)  CY14                    vulnerability.          complete. 
----------------------  ----------------------  ----------------------  ----------------------  ---------------------- 
                                                                        Greenfield mine 
                                                                        development and 
                                                                        expansion of the Peak 
                                                                        Downs Mine with 
                                                                        capacity to produce 
Caval Ridge                                                             8.0 million tpa of      Approval announced. 
(Australia) 50%                                                         export metallurgical    See News Release dated 
Metallurgical Coal                    2,100(b)  CY14                    coal.                   1 November 2011. 
----------------------  ----------------------  ----------------------  ----------------------  ---------------------- 
                                                                                                On schedule and 
                                                                                                budget. The overall 
                                                                        Increases run-of-mine   project is 62% 
                                                                        thermal coal            complete. First 
RX1 Project                                                             production by           production is now 
(Australia) 100%                                                        approximately 4         expected 
Energy Coal                                400  H2 CY12                 million tpa.            in H2 CY12. 
----------------------  ----------------------  ----------------------  ----------------------  ---------------------- 
                                                                        Increases saleable 
                                                                        thermal coal 
                                                                        production by 8         On schedule and 
Cerrejon P40 Project                                                    million tpa to          budget. The overall 
(Colombia) 33.3%                                                        approximately 40        project is 11% 
Energy Coal                                437  CY13                    million tpa.            complete. 
----------------------  ----------------------  ----------------------  ----------------------  ---------------------- 
Newcastle Third Port                                                    Increases total coal    On schedule and 
Project Stage 3                                                         terminal capacity from  budget. The overall 
(Australia) 35.5%                                                       53 million tpa to 66    project is 12% 
Energy Coal                                367  CY14                    million tpa.            complete. 
----------------------  ----------------------  ----------------------  ----------------------  ---------------------- 
 

Substantial increase in the Spence Mineral Resource

BHP Billiton today announced a near 700 per cent increase in the Mineral Resource tonnage of the wholly owned Spence mine in northern Chile. This increase reflects the initial declaration of a significant hypogene (chalcopyrite) extension of the supergene (chalcocite and copper oxide) mineralisation that comprises the current Mineral Resource. The reporting of hypogene Mineral Resource follows a four year US$30 million brownfield exploration program.

This significant Mineral Resource increase, in addition to the previously announced 129 per cent(c) increase in the Mineral Resource surrounding Escondida and a 32 per cent(c) increase in the Antamina Mineral Resource, further demonstrates the continued success of BHP Billiton's extensive brownfield exploration program. Elsewhere in the portfolio, a total of 542 thousand metres was drilled across the Pilbara in the 2011 calendar year, contributing to a 20 per cent(d) increase in the WAIO Mineral Resource to 19.3 billion tonnes(d) as reported in the 2011 Annual Report. In the Saskatchewan potash basin, BHP Billiton's activities included the completion of a 3D seismic survey and deep drilling on an exploration target, and four seismic 2D programs. In our Metallurgical Coal business, a total of 267 thousand metres was drilled across the Bowen Basin during the 2011 calendar year, increasing our confidence in the Mineral Resource underpinning our development projects including Daunia and Caval Ridge.

Mineral Resource - Spence (100%)(e)

As at 31 December 2011

 
                                          Measured 
                                          Resource     Indicated Resource    Inferred Resource       Total Resource 
-----------  -------------  ---------  --------------  -------------------  --------------------  -------------------- 
                                  BHP  Millions        Millions              Millions              Millions 
                             Billiton    of dry          of dry                of dry                of dry 
Commodity                    interest    metric     %    metric     %  ppm     metric     %  ppm     metric     %  ppm 
Deposit(f)   Ore type               %    tonnes   TCu    tonnes   TCu   Mo     tonnes   TCu   Mo     tonnes   TCu   Mo 
-----------  -------------  ---------  --------  ----  --------  ----  ---  ---------  ----  ---  ---------  ----  --- 
Copper 
-----------  -------------  ---------  --------  ----  --------  ----  ---  ---------  ----  ---  ---------  ----  --- 
Spence(g)    Oxide                100        53  0.99        14  0.83    -        0.3  0.46    -         68  0.95    - 
-----------  -------------  ---------  --------  ----  --------  ----  ---  ---------  ----  ---  ---------  ----  --- 
 Low-grade oxide and 
  sulphide                                    8  0.25         9  0.25    -        2.4  0.23    -         20  0.25    - 
 -------------------------  ---------  --------  ----  --------  ----  ---  ---------  ----  ---  ---------  ----  --- 
 Supergene sulphide                         156  0.96        62  0.64    -        4.0  0.54    -        221  0.86    - 
 -------------------------  ---------  --------  ----  --------  ----  ---  ---------  ----  ---  ---------  ----  --- 
 Transitional sulphide                       24  0.72         9  0.51    -        0.7  0.38    -         34  0.66    - 
 -------------------------  ---------  --------  ----  --------  ----  ---  ---------  ----  ---  ---------  ----  --- 
 Hypogene sulphide                            -     -     1,184  0.46  148      1,167  0.39   86      2,352  0.43  117 
 -------------------------  ---------  --------  ----  --------  ----  ---  ---------  ----  ---  ---------  ----  --- 
 

As at 30 June 2011

 
                                                                                       Total Resource 
---------------------  -----------------------------  ---------------------  ----------------------------------- 
                                                      BHP Billiton interest                                    % 
Commodity Deposit(f)   Ore type                                           %  Millions of dry metric tonnes   TCu 
---------------------  -----------------------------  ---------------------  -----------------------------  ---- 
Copper 
---------------------  -----------------------------  ---------------------  -----------------------------  ---- 
Spence(g)              Oxide                                            100                             64  1.01 
---------------------  -----------------------------  ---------------------  -----------------------------  ---- 
 Low-grade oxide and sulphide                                                                           22  0.24 
 ---------------------------------------------------  ---------------------  -----------------------------  ---- 
 Supergene sulphide                                                                                    222  0.91 
 ---------------------------------------------------  ---------------------  -----------------------------  ---- 
 Transitional sulphide                                                                                  37  0.65 
 ---------------------------------------------------  ---------------------  -----------------------------  ---- 
 Hypogene sulphide                                                                                       -     - 
 ---------------------------------------------------  ---------------------  -----------------------------  ---- 
 

Minerals exploration

Greenfield exploration continued on copper targets in South America, Mongolia and Zambia; nickel and copper targets in Australia. Exploration for iron ore, potash and uranium was undertaken in a number of regions including Australia, Africa and the Americas.

For the December 2011 half year, BHP Billiton spent US$532 million on minerals exploration, of which US$451 million was expensed.

Petroleum exploration

Exploration and appraisal wells drilled during the quarter or in the process of drilling as at 31 December 2011.

 
Well             Location                            BHP Billiton equity         Status 
---------------  ----------------------------------  --------------------------  ------------------------------------- 
                                                                                 Plugged and abandoned Hydrocarbons 
Deep Blue-1      Gulf of Mexico GC 723               31.875% (Noble operator)    encountered 
---------------  ----------------------------------  --------------------------  ------------------------------------- 
                                                                                 Plugged and abandoned Hydrocarbons 
                                                                                 encountered See news release dated 7 
Mad Dog North-1  Gulf of Mexico GC 738               23.9% (BP operator)(h)      September 2011 
---------------  ----------------------------------  --------------------------  ------------------------------------- 
Jujur-1          Sabah Malaysia Block N              60% (Operator)              Temporarily suspended 
---------------  ----------------------------------  --------------------------  ------------------------------------- 
Julong Centre    Brunei Block CA-01                  22.5% (Total operator)      Drilling ahead 
---------------  ----------------------------------  --------------------------  ------------------------------------- 
Seraph-1         North West Shelf Australia WA-3-L   16.67% (Woodside operator)  Plugged and abandoned Dry hole 
---------------  ----------------------------------  --------------------------  ------------------------------------- 
Gunflint-3       Gulf of Mexico MC948                11.2% (Noble operator)      Drilling ahead 
---------------  ----------------------------------  --------------------------  ------------------------------------- 
                                                                                 Plugged and abandoned Hydrocarbons 
Tidepole East    North West Shelf Australia WA-28-P  16.67% (Woodside operator)  encountered 
---------------  ----------------------------------  --------------------------  ------------------------------------- 
 

Petroleum exploration expenditure for the December 2011 half year was US$565 million, of which US$265 million was expensed. Our guidance for petroleum exploration expenditure for the 2012 financial year is US$1.4 billion, including the new Onshore US exploration.

(a) Facilities ready for first production pending resolution of mercury content.

(b) Excludes announced pre-commitment funding.

(c) This BHP Billiton Mineral Resource information was sourced from the BHP Billiton 2011 Annual Report. This document can be viewed at www.bhpbilliton.com. The Mineral Resource information is compiled by Richard Preece (FAusIMM) - Escondida and Jhon Espinoza (MAusIMM) - Antamina, who are full time employees of BHP Billiton and who have the required qualifications and experience to qualify as Competent Persons under the JORC Code and consent to the form and context in which it appears above. Mineral Resources are stated on a 100% basis. The detailed breakdown of Escondida Mineral Resources is 3.1bt @ 0.75% Cu Measured, 4.7bt @ 0.59% Cu Indicated, 11.7bt @ 0.49% Cu Inferred, and Antamina Mineral Resources is 187mt @ 0.85% Cu Measured, 1,019mt @ 0.91% Cu Indicated, 708mt @ 0.73% Cu Inferred.

(d) This BHP Billiton Mineral Resource information was sourced from the BHP Billiton 2011 Annual Report. This document can be viewed at www.bhpbilliton.com. The Mineral Resource information is compiled by Paul Whitehouse (MAusIMM) - Western Australian Iron Ore, who is a full time employee of BHP Billiton and who has the required qualifications and experience to qualify as a Competent Person under the JORC Code and consents to the form and context in which it appears above. Mineral Resources are stated on a 100% basis. The detailed breakdown of the Western Australian Iron Ore Mineral Resources is 2.2bt @ 59.3% Fe Measured, 3.9bt @ 60.1% Fe Indicated, 13.2bt @ 59.1% Fe Inferred.

(e) Competent Person - J. Cespedes (MAusIMM).

The statement of Mineral Resources is presented on a 100 per cent basis and is based on information compiled by the above named Competent Person and relates to Mineral Resources estimates as at 31 December 2011. Mr. Cespedes is a full time employee of BHP Billiton Limited, has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity he is undertaking to qualify as a Competent Person as defined in the JORC Code, and he is a member of the Australasian Institute of Mining & Metallurgy (AusIMM). The Competent Person consents to the inclusion in this report of the matters based on their information in the form and context in which it appears.

(f) %TCu - per cent total copper, ppm Mo - parts per million molybdenum.

(g) Spence - The inclusion of hypogene sulphide Mineral Resource is partly a result of exploration and infill drilling results, and partly a result of selection (pre-feasibility) stage studies that have demonstrated the potential of economic viability for open pit mining, milling, and flotation of the hypogene resource. Hypogene sulphides are newly reported chalcopyrite - molybdenite mineralisation that are the precursor to and immediately underlies the supergene and transitional sulphide ore types that are currently processed through heap leaching and SX-EW. The deposit has been evaluated with 108,000 meters of drill core in 264 holes located on grid spacing of 100x100 metres for Indicated tonnages and 200x200 meters for Inferred. Changes in the supergene resources compared to 30 June 2011 include additional drilling, revised pit design and depletion due to production during the first half of the 2012 financial year.

(h) BHP Billiton is operator of the well.

Further information on BHP Billiton can be found at: www.bhpbilliton.com

 
 Media Relations                                      Investor Relations 
 
  Australia                                            Australia 
  Samantha Stevens                                     James Agar 
  Tel: +61 3 9609 2898 Mobile: +61 400 693 915         Tel: +61 3 9609 2222 Mobile: +61 467 807 064 
  email: Samantha.Stevens@bhpbilliton.com              email: James.Agar@bhpbilliton.com 
 
  Kelly Quirke                                         Andrew Gunn 
  Tel: +61 3 9609 2896 Mobile: +61 429 966 312         Tel: +61 3 9609 3575 Mobile: +61 439 558 454 
  email: Kelly.Quirke@bhpbilliton.com                  email: Andrew.Gunn@bhpbilliton.com 
 
  Fiona Martin                                         United Kingdom and South Africa 
  Tel: +61 3 9609 2211 Mobile: +61 427 777 908         Brendan Harris 
  email: Fiona.Martin2@bhpbilliton.com                 Tel: +44 20 7802 4131 Mobile: +44 7990 527 726 
                                                       email: Brendan.Harris@bhpbilliton.com 
  United Kingdom and Americas 
  Ruban Yogarajah                                      Tara Dines 
  Tel: US +1 713 966 2907 or UK +44 20 7802 4033       Tel : +44 20 7802 7113 Mobile : +44 7825 342 232 
  Mobile: UK +44 7827 082 022                          Email : Tara.Dines@bhpbilliton.com 
  email: Ruban.Yogarajah@bhpbilliton.com 
                                                       Americas 
                                                       Scott Espenshade 
                                                       Tel: +1 713 599 6431 Mobile: +1 713 208 8565 
                                                       email: Scott.Espenshade@bhpbilliton.com 
 BHP Billiton Limited ABN 49 004 028 077              BHP Billiton Plc Registration number 3196209 
  Registered in Australia                              Registered in England and Wales 
  Registered Office: 180 Lonsdale Street               Registered Office: Neathouse Place 
  Melbourne Victoria 3000 Australia                    London SW1V 1BH 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 Billiton Group which is headquartered in Australia 
 

This information is provided by RNS

The company news service from the London Stock Exchange

END

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