BMA faces September quarter production challenge

THE BHP Billiton Mitsubishi Alliance will be squeezing more hard coking coal production out if its new star performer in central Queensland – Caval Ridge – in the September quarter to compensate for a hiatus in production during the quarter due to longwall moves and the winding down of the Crinum mine.
BMA faces September quarter production challenge BMA faces September quarter production challenge BMA faces September quarter production challenge BMA faces September quarter production challenge BMA faces September quarter production challenge

BHP Billiton's Crinum longwall.

Lou Caruana

Longwall moves at the Broadmeadow and Crinum mines, and wash-plant shutdowns at Goonyella and Peak Downs mines are scheduled for the September 2015 quarter.

A longwall move at Crinum move in the March quarter had earlier impacted on production rates that were already adversely affected by bad weather.

At current mining rates, operations at Crinum are expected to cease in the first quarter of the 2016 calendar year as the mine approaches the end of its economic reserve life.

Meanwhile the successful ramp-up of the Caval Ridge mine and continued productivity improvements at the mine helped the company report a record 43 million tonnes of production in 2015.

The company is expected to further optimise production rates from Caval Ridge during the September quarter as well as strive to maintain the increase in equipment and wash-plant utilisation rates which underpinned record volumes at its six other central Queensland operations.

There could still be a thin wedge of profit margin for BHP Billiton too. Although it pales in significance compared to other BHP businesses, Macquarie Wealth Management analysts have forecast BHP Billiton’s Queensland coal operations to remain below $70/t in C1 cash costs right through to the 2019-2020 financial year.

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