Miner BHP holds on to iron production guidance despite coronavirus
Mining giant BHP has maintained its production guidance for iron, coal and petroleum for 2020 despite the ongoing economic shutdown caused by coronavirus.
However, the firm said that it expected to see double-digit contraction outside of China could contract by a double-digit figure, and that capital spending could fall below the $8bn previously forecast.
In the nine months to 31 March, iron production rose three per cent to 181m tonnes, with a seven per cent rise in the final quarter.
For the whole year, BHP said its iron ore production would be unchanged at 273-286m tonnes but said petroleum output would likely hit the bottom end of previous guidance of 110-116m barrels of oil.
Petroleum production has already dropped 10 per cent for the year to date, and 13 per cent in the last quarter, due to the supply glut currently squeezing the market.
BHP also put energy coal and copper production forecasts under review given temporary shutdowns of its Cerrejon coal mine in Columbia and its Antamina copper mine in Peru.
The world’s largest miner has managed to keep most of its operations going despite the coronavirus disruption, using a series of measures to ensure safe working for its employees.
According to BHP chief executive Mike Henry, a small number of its 72,000 employees have contracted the virus, but all have recovered or are recovering.
Henry said that while the Chinese economy had begun to lift in recent weeks, the firm was expecting developed economies such as Europe, the US and India to “contract sharply” in the second quarter.
He said: “The situation remains fluid, however, with our strong financial position and low-cost operations, our business is resilient, with capacity to generate solid cash flow through this period and emerge well placed as the global economy recovers.
“Our priorities are the continued safety of our people, continuing reliable operations and supporting our customers, suppliers and communities in these challenging times.”