22 Apr 2020

Covid-19 Measures Reduce BHP Thermal coal Output

22 Apr 2020  by MONTEL   

Mining firm BHP’s thermal coal output declined 14% to 5.8m tonnes in the January-March, as measures to stem the spread of the Covid-19 pandemic, coupled with weather-related disruptions, affected production.

In the first three-quarters of the 2019-20 financial year, output declined 13% to 17.5m tonnes, it said late on Monday.

Colombian output at the Cerrejon mining complex – which is jointly owned by BHP, Anglo American and Glencore – was 10% lower in the past three months, versus the same period last year, at around 2m tonnes.

This was due to Colombian government efforts to contain the spread of Covid-19.

“A decision has been made to place Cerrejon on temporary care and maintenance,” it said, noting it was still unclear to what extent this would affect the full-year production total.

At the company’s Australian assets, output fell 16% in January-March to 4m tonnes, as a result of a change in product strategy, to focus on the production of higher-quality coal.

In addition, reduced air quality at our operations negatively impacted production in December-January, with wet weather further constraining operations during February,” it said, adding however full financial year output was still expected to total 15-17m tonnes – in line with previous estimates.

“The Covid-19 situation continues to be monitored, with preventative measures in place to protect the workforce, including reduced site travel, social distancing practices and strict hygiene protocols,” it said.

Meanwhile, total output for the fiscal year 2019-20 is currently forecast to reach 24-26m tonnes, although the outlook is “under review”.

“All guidance is subject to potential impacts from Covid-19 during the June 2020 quarter,” it said.

BHP produced 27m tonnes in the prior 12 months of 2018-19.

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