AUST today (extract):
BHP EYES DOUBLING COPPER PRODUCTION
Cameron England
BHP is looking to more than double copper production out of South Australia over the next decade and will make a final investment decision on a major smelter upgrade at Olympic Dam within 2½ years, as it revealed a large increase in resources in the state.
The global miner has published a resource estimate for its Oak Dam deposit, 65km southeast of the Olympic Dam mine and smelter, where it has to date delineated 1.34 billion tonnes of copper and gold ore.
BHP is also progressing approvals with the state government for new shafts at Oak Dam and Olympic Dam, so that it can drill out the deposits at greater depths. The company has built a copper precinct in SA via the $6.4bn acquisition of OZ Minerals in May last year, which brought the Prominent Hill and Carrapateena copper and gold mines into the fold.
While the integrated Olympic Dam asset – comprising the underground mine and processing operations – has in the past struggled to achieve profitability in some years, the combined portfolio, now known as Copper South Australia, delivered $US928m in underlying earnings to the group in the past financial year, on revenue of $US4.1bn.
BHP is forecasting production in SA in the current year to increase to 310,000-340,000 tonnes of copper, up from 322kt, with significant expansion plans on the cards in coming years.
The company on Tuesday said it was assessing the optimal pathway for a smelter and refinery expansion at Olympic Dam to increase output to more than 500kt by the early 2030s, and up to 650kt from the mid-2030s.
BHP Price at posting:
$41.35 Sentiment: Buy Disclosure: Held
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