21st Jun 2016 05:28
LONDON (Alliance News) - Anglo-Australian miner BHP Billiton PLC on Tuesday outlined plans to improve returns from its coal business, focused on boosting productivity, cutting costs and releasing latent capacity.
Mike Henry, the president of the company's Australian minerals operation, said the company sees a significant opportunity to increase the competitiveness of its coal business.
"Rather than waiting for higher prices, we have been deliberate in shaping a quality, focused portfolio that allows us to deliver value in challenging market conditions and positions us well for an expected longer-term improvement in coal market fundamentals," said Henry.
"While cost compression has been evident across the industry, we continue to work hard under our new operating model to improve our performance. Even in today?s difficult environment, all of our operations remain cash positive," Henry added.
BHP said it has delivered USD3.0 billion in productivity gains in its coal business, focused on costs and volumes, since 2012 and is targeting another USD600.0 million by the end of its 2017 financial year.
BHP added it can grow its coal business through releasing latent, low-cost capacity and by pushing forward with growth options if market conditions are supportive of such a move.
"Against the backdrop of greater uncertainty in the outlook for thermal coal, we are confident that base demand in emerging economies will remain resilient for decades to come and our higher quality coals position us well in an increasingly carbon constrained world," Henry said.
By Sam Unsted; [email protected]; @SamUAtAlliance
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