BHP Billiton today outlined how its focus on productivity and capital efficient debottlenecking in its iron ore business is delivering value.
Speaking at the AJM Global Iron Ore and Steel Forecast conference, BHP Billiton Iron Ore President Jimmy Wilson, reiterated the Company’s view of the iron ore market and its Western Australia Iron Ore business.
“Our market outlook is for continued strong steel demand growth over the next 10 years. Our view that Chinese crude steel production is expected to peak at 1.1 billion tonnes, around 2025, is unchanged. We remain confident that global demand for iron ore will continue to grow, though at a more moderate rate, driven by urbanisation and industrialisation,” he said.
“BHP Billiton will retain a favourable position on the iron ore cost curve underpinned by the quality of our resource base. These resources further position us to benefit from an increasing market preference for high quality lump and fines iron ore products.”
Mr Wilson also reiterated the Company’s productivity agenda was underway and delivering significant value.
“Our journey to deliver sustainable productivity benefits has encompassed a full review of the supply chain across mines, rail and port. Our initial focus on equipment availability, utilisation and operating rate was followed by low-cost debottlenecking initiatives.
“Across our mines we have realised significant productivity improvements that have resulted in increased shovel, truck and ore handling plant availability and utilisation. Where appropriate, we have also installed relocatable crushers to increase high margin volumes.”
Over the longer term, BHP Billiton has a low-cost option to expand Jimblebar production to 55 million tonnes per annum (mtpa), as well as debottlenecking of the supply chain, to deliver capital efficient growth towards 270 mtpa (100 per cent basis).
“Our Iron Ore business is well positioned to deliver high margin volume growth at a lower cost without the need for an additional mining hub or major port and rail infrastructure,” Mr Wilson said.
A copy of the presentation can be found here.