(MENAFN- ProactiveInvestors - UK) BHP Billiton PLC (LON:BLT) looked set to add to the world's commodity mountain as it unveiled better-than-expected production.
Billiton said it topped full-year production guidance forpetroleum, copper and metallurgical coal and achieved record full-year production at Western Australia Iron Ore (WAIO).
But the company said it would take a profit hit of up to US$175mln from redundancy costs, coal impairments and a reversal ofprevious stock write-downs due to a slight recovery in commodity prices.
Rival Rio Tinto's shares fell on Tuesday after the company boosted aluminium and copper output. Russ Mould at AJ Bell said that "will do little to ease the market's fears that key commodities could remain glutted for some time to come."
Billiton forecast it would meet full-year unit cost guidance at its major assets, with unit costs forecast to decline further next year.
In petroleum, exploration drilling has begun in Trinidad and Tobago and in the Gulf of Mexico following positive results at Shenzi North during the year.
Four major projects under development are tracking to plan in petroleum, copper and potash, with a combined budget of US$6.9bn over the life of the schemes.
Record WAIO volumes were offset by the suspension of operations at Samarco in Brazil following the fatal dam collapse.
It said: "For the June 2016 half year, we are not yet in a position to provide an update to the potential financial impacts on BHP Billiton Brasil of the Samarco dam failure.
"We are continuing to work closely with Samarco and will provide an update as soon as we are in a position to do so.
"Any potential financial impacts related to the tragedy are expected to be classified as an exceptional item."
Chief executive Andrew MacKenzie said: "Over the next 12 months, we expect volumes and costs across our minerals businesses to benefit from our continued drive to safely improve productivity.
"We can create significant value through further cost reductions, taking advantage of latent capacity in our assets and investing in low-capital projects.
"These initiatives are expected to increase production by 5% in copper, up to 4% in iron ore and 3% in metallurgical coal in the next financial year.
"In petroleum, we have achieved strong performance from our conventional assets and responded to market conditions by reducing the number of rigs in our onshore US assets as we focus on cash flow and value.
"We have taken advantage of the fall in deep water drilling costs and accelerated our conventional oil exploration program to simultaneously run campaigns in the Gulf of Mexico and the Caribbean.
"We are well positioned to bring on shale volumes as markets tighten and develop conventional resources over the medium to long term."
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