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BHP Q4 Iron Ore Production Down 1%

BHP (BHP.AX,BLT.L,BBL,BHP) reported that its total iron ore production for the fourth-quarter declined by 2 percent to 63 million tonnes, while it declined 1 percent to 71 million tonnes on a 100 per cent basis. The company expects a negative movement in productivity of about US$1 billion for the 2019 financial year, excluding the impact of Tropical Cyclone Veronica on WAIO operations.

BHP expects total iron ore production for the 2020 financial year to be between 242 million tonnes and 253 million tonnes or 273 million tonnes and million tonnes Mt on a 100 per cent basis.

Total petroleum production for the fourth-quarter increased by 4 percent to 30 million barrels of oil equivalent. Volumes are expected to decrease to between 110 and 116 MMboe in the 2020 financial year as a result of planned maintenance at Atlantis and natural field decline across the portfolio.

Total copper production for the quarter decreased by four percent to 444 thousand tonnes. Production of between 1.705 million tonnes and 1.820 million tonnes is expected in the 2020 financial year.

Group copper equivalent production for the 2020 financial year is expected to be slightly higher than the 2019 financial year despite a about 7% decline in petroleum volumes largely due to natural field decline.

BHP said it is currently reviewing the assumptions used to determine the Group's provision for the Samarco dam failure.

Samarco is currently progressing plans for the accelerated decommissioning of its upstream tailings dams, due to legislative changes in Brazi. The accelerated timing is expected to result in a provision of approximately US$260 million (BHP share), as Samarco is not currently expected to generate sufficient cash flows to fund the required decommissioning costs.

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