BHP Billiton established strong momentum in its Base Metals business in the June 2012 quarter. Escondida copper production increased by 22% from the March 2012 quarter as mining activities progressed towards higher grade ore while quarterly material mined, mill throughput and copper production records at Antamina added to the strong finish to the year. Annual copper production however declined marginally in the 2012 financial year as lower grades and industrial action constrained performance at Escondida for the first 9 months of the year.
BHP Billiton Financial Results for the year ended June 30th 2012 15 Underlying EBIT for the 2012 financial year decreased by USD 2.8 billion to USD 4.0 billion. A 14% fall in the average realized price of copper to USD 3.58 per pound was the major contributor to the decline and reduced Underlying EBIT by USD 1.4 billion. General cost pressure across the Base Metals portfolio, together with unit cost escalation specifically associated with industrial activity and lower ore grades at Escondida, reduced Underlying EBIT by USD 841 million.
At June 30th 2012, the Group had 278,547 tonnes of outstanding copper sales that were revalued at a weighted average price of USD 3.49 per pound. The final price of these sales will be determined in the 2013 financial year. In addition, 239,156 tonnes of copper sales from the 2011 financial year were subject to a finalization adjustment in 2012. This finalization adjustment and the provisional pricing impact as at 30 June 2012 decreased Underlying EBIT by USD 265 million for the period.
Escondida copper production is forecast to increase by approximately 20% in the 2013 financial year. Successful completion of both the Escondida Ore Access and Laguna Seca debottlenecking projects is expected to drive Escondida copper production to over 1.3 million tonnes in the 2015 financial year. Development of Escondida Organic Growth Project 1 and the Oxide Leach Area Project is expected to sustain Escondida copper production at an elevated level for the remainder of this decade.
Source - BHP Billiton Limited
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