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BIL
BIBLT
BIL - BHP Billiton Plc - BHP Billiton exploration and development report for
the quarter ended 31 December 2011
BHP Billiton Plc
Share code: BIL
ISIN: GB0000566504
NEWS RELEASE
18 January 2012
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
(both Australia) which will add high quality export coking coal capacity and
future development options for our leading Queensland Coal business. BHP
Billiton also approved the Western Australia Iron Ore (WAIO) Orebody 24 mine
and the North West Shelf Greater Western Flank-A project (Australia).
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 business
totalled US$0.9 billion during the December 2011 quarter and US$1.4 billion
during the December 2011 half year.
Project and Share of Initial Production Quarterly progress
ownership approved production capacity (100%)
capex target
(US$m) date
Petroleum
projects
Macedon 1,050 CY13 200 million On schedule and budget.
(Australia) cubic feet gas The overall project is
71.43% Gas per day. 45% complete.
Bass Strait 900 CY12(a) 10,000 bpd On revised schedule and
Kipper condensate and budget. The overall
(Australia) processing project is 88% complete.
32.5% - 50% capacity of 80
Gas/Gas million cubic
Liquids feet gas per
day.
Bass Strait 1,350 CY13 11,000 bpd On revised schedule and
Turrum condensate and budget. The overall
(Australia) processing project is 72% complete.
50% Gas/Gas capacity of 200
Liquids million cubic
feet gas per
day.
North West 850 CY13 2,500 million On budget. Steady state
Shelf North cubic feet gas production remains on
Rankin B Gas per day. track for CY13. The
Compression overall project is 85%
(Australia) complete.
16.67% LNG
North West 400 CY16 To maintain LNG Project approved by all
Shelf Greater plant throughput joint venture partners
Western Flank- from the North in December 2011.
A (Australia) West Shelf
16.67% LNG operations.
Minerals
projects
Worsley 2,995 Q1 CY12 1.1 million tpa On revised schedule and
Efficiency & of additional budget. The overall
Growth alumina. project is 94% complete.
(Australia) Marradong mine has been
86% Alumina commissioned and is
ramping up to expected
capacity.
Antamina 435 Q1 CY12 Increases ore In commissioning phase
Expansion processing with first production
(Peru) 33.75% capacity to now expected in Q1 CY12.
Copper 130,000 tpd. The overall project is
79% complete.
Escondida Ore 319 Q2 CY12 The relocation On schedule and budget.
Access (Chile) of the in-pit The overall project is
57.5% Copper crushing and 77% complete.
conveyor
infrastructure
provides access
to higher grade
ore.
EKATI Misery 323 CY15 Project consists On schedule and budget.
Open Pit of a pushback of The overall project is
Project the existing 16% complete.
(Canada) 80% Misery open pit
Diamonds which was mined
from 2001 to
2005.
WAIO Jimblebar 3,300(b) Q1 CY14 Increases mining On schedule and budget.
Mine Expansion and processing The overall project is
(Australia) capacity to 35 21% complete.
96% Iron Ore million tpa with
incremental
debottlenecking
opportunities to
55 million tpa.
WAIO Port 1,900(b) H2 CY12 Increases total On schedule and budget.
Hedland Inner inner harbour The overall project is
Harbour capacity to 220 42% complete.
Expansion million tpa with
(Australia) debottlenecking
85% Iron Ore opportunities to
240 million tpa.
WAIO Port 1,400(b) H2 CY14 Optimises On schedule and budget.
Blending and resource and The overall project is
Rail Yard enhances 13% complete.
Facilities efficiency
(Australia) across the WAIO
85% Iron Ore supply chain.
WAIO Orebody 698 H2 CY12 Maintains iron Approval announced. See
24 (Australia) ore production News Release dated 16
85% Iron Ore output from the November 2011.
Newman Joint
Venture
operations.
Samarco Fourth 1,750 H1 CY14 Increases iron On schedule and budget.
Pellet Plant ore pellet The overall project is
(Brazil) 50% production 18% complete.
Iron Ore capacity by 8.3
million tpa to
30.5 million
tpa.
Daunia 800 CY13 Greenfield mine On schedule and budget.
(Australia) development with The overall project is
50% capacity to 27% complete.
Metallurgical produce 4.5
Coal million tpa of
export
metallurgical
coal.
Broadmeadow 450 CY13 Increases On schedule and budget.
Life Extension productive The overall project is
(Australia) capacity by 0.4 56% complete.
50% million tpa and
Metallurgical extends life of
Coal the mine by 21
years.
Hay Point 1,250(b) CY14 Increases port On schedule and budget.
Stage Three capacity from 44 The overall project is
Expansion million tpa to 36% complete.
(Australia) 55 million tpa
50% and reduces
Metallurgical storm
Coal vulnerability.
Caval Ridge 2,100(b) CY14 Greenfield mine Approval announced. See
(Australia) development and News Release dated 1
50% expansion of the November 2011.
Metallurgical Peak Downs Mine
Coal with capacity to
produce 8.0
million tpa of
export
metallurgical
coal.
RX1 Project 400 H2 CY12 Increases run-of-On schedule and budget.
(Australia) mine thermal The overall project is
100% Energy coal production 62% complete. First
Coal by approximately production is now
4 million tpa. expected in H2 CY12.
Cerrejon P40 437 CY13 Increases On schedule and budget.
Project saleable thermal The overall project is
(Colombia) coal production 11% complete.
33.3% Energy by 8 million tpa
Coal to approximately
40 million tpa.
Newcastle 367 CY14 Increases total On schedule and budget.
Third Port coal terminal The overall project is
Project Stage capacity from 53 12% complete.
3 (Australia) million tpa to
35.5% Energy 66 million tpa.
Coal
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 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
Commodity Ore type BHP Billiton Millions of %
Deposit(f) interest dry metric TCu
% tonnes
Copper
Spence(g) Oxide 100 53 0.99
Low-grade oxide and 8 0.25
sulphide
Supergene sulphide 156 0.96
Transitional sulphide 24 0.72
Hypogene sulphide - -
Indicated Resource
Commodity Ore type BHP Billiton Millions of % Ppm
Deposit(f) interest dry metric TCu Mo
% tonnes
Copper
Spence(g) Oxide 100 14 0.83 -
Low-grade oxide and 9 0.25 -
sulphide
Supergene sulphide 62 0.64 -
Transitional 9 0.51 -
sulphide
Hypogene sulphide 1,184 0.46 148
Inferred Resource
Commodity Ore type BHP Billiton Millions of % Ppm
Deposit(f) interest dry metric TCu Mo
% tonnes
Copper
Spence(g) Oxide 100 0.3 0.46 -
Low-grade oxide and 2.4 0.23 -
sulphide
Supergene sulphide 4.0 0.54 -
Transitional 0.7 0.38 -
sulphide
Hypogene sulphide 1,167 0.39 86
Total Resource
Commodity Ore type BHP Billiton Millions of % Ppm
Deposit(f) interest % dry metric TCu Mo
tonnes
Copper
Spence(g) Oxide 100 68 0.95 -
Low-grade oxide and 20 0.25 -
sulphide
Supergene sulphide 221 0.86 -
Transitional 34 0.66 -
sulphide
Hypogene sulphide 2,352 0.43 117
As at 30 June 2011
Total Resource
Commodity Ore type BHP Billiton Millions of %
Deposit(f) interest dry metric TCu
% tonnes
Copper
Spence(g) Oxide 100 64 1.01
Low-grade oxide 22 0.24
and sulphide
Supergene 222 0.91
sulphide
Transitional 37 0.65
sulphide
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
Deep Blue-1 Gulf of Mexico GC 31.875% (Noble Plugged and
723 operator) abandoned
Hydrocarbons
encountered
Mad Dog North-Gulf of Mexico GC 23.9% (BP Plugged and
1 738 operator)(h) abandoned
Hydrocarbons
encountered See news
release dated 7
September 2011
Jujur-1 Sabah Malaysia Block 60% (Operator) Temporarily
N suspended
Julong Centre Brunei Block CA-01 22.5% (Total Drilling ahead
operator)
Seraph-1 North West Shelf 16.67% (Woodside Plugged and
Australia WA-3-L operator) abandoned Dry hole
Gunflint-3 Gulf of Mexico MC948 11.2% (Noble Drilling ahead
operator)
Tidepole East North West Shelf 16.67% (Woodside Plugged and
Australia WA-28-P operator) abandoned
Hydrocarbons
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 program.
(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
metres of drill core in 264 holes located on grid spacing of 100x100 metres
for Indicated tonnages and 200x200 metres 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.
****
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