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22 Jan 2019 | 08:08

BHP Billiton lifts guidance on copper production after retaining Cerro Colorado

BHP Billiton on Tuesday first-half copper, and petroleum production fell, but full-year copper production guidance was raised as the company scrapped plans to sell Cerro Colorado operations.

Total copper production guidance for the year through June was raised to between 1,645 and 1,740 kt from previous guidance of between 1,620 and 1,705 kt.

The improved guidance comes as the company retained its Cerro Colorado operation as its agreement to sell it to EMR Capital was terminated after it became clear that the financing conditions of the transaction would not be satisfied by the end of the 2018 calendar year.

Production at Cerro Colorado for the 2019 financial year was expected to be between 60 and 70 kt.

For the six months through December, copper equivalent production fell by 1% to 825,000 tonnes, iron ore production rose 2% to 119,226Kt and petroleum production fell 5% to 29 MMboe.

In Petroleum, the company's first appraisal well at Trion in Mexico encountered oil and exploration options were also bolstered with successful bids for two licences offshore Eastern Canada.

Productivity for the December 2018 half year had been impacted by unplanned production outages at Olympic Dam, Spence and Western Australia Iron Ore, with a total negative impact of approximately $600m, the company said.

Surface operations at Olympic Dam, however, had resumed at the end of October 2018 following completion of acid plant remediation works.

Full year unit costs for all major assets were expected to be in line with guidance, predominantly reflecting 'stronger anticipated volumes in the second half of the year,' the company said. 'We completed the sale of our US shale assets and returned US$5.2 billion to shareholders through a share buy-back program, with a further US$5.2 billion to be returned as a special dividend on 30 January 2019,' said BHP Chief Executive Officer, Andrew Mackenzie.

At 8:08am: (LON:BHP) share price was -32.5p at 1578.5p

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