BHP Billiton Exploration and Development Report

BHP BILLITON EXPLORATION AND DEVELOPMENT REPORT

FOR THE QUARTER ENDED 31 DECEMBER 2011

This report covers the Group's exploration and development activities for the December 2011 quarter. Unless otherwise stated, BHP Billiton's interest in the projects referred to in this report is 100 per cent and references to project schedules are based on calendar years.

Development

A focus on high return growth projects, diversified by commodity, geography and market was further reinforced during the December 2011 half year with the approval of projects in the Metallurgical Coal and Energy Coal businesses. BHP Billiton's commitment to its world class growth pipeline now exceeds US$26 billion.

During the December 2011 quarter, BHP Billiton announced the approval of the Caval Ridge mine development and the expansion of the Peak Downs operation which will add high quality export coking coal capacity and future development options for our leading Queensland Coal business. BHP Billiton also approved construction of the Western Australia Iron Ore (WAIO) Orebody 24 mine and the North West Shelf Greater Western Flank-A project.

Pre-commitment expenditure of US$1.2 billion for the first phase of the Olympic Dam Project (Australia) was activated following environmental approval by the Government of South Australia and the Commonwealth and the successful passage of the Indenture agreement through the South Australian Parliament. This funding will facilitate the procurement of long lead time items such as trucks and accommodation, infrastructure development and early site works.

Onshore US drilling and development expenditure in the Petroleum division totalled US$0.9 billion during the December 2011 quarter and US$1.4 billion during the December 2011 half year.

Substantial increase in the Spence Mineral Resource

BHP Billiton today announced a near 700 per cent increase in the Mineral Resource tonnage of the wholly owned Spence mine in northern Chile. This increase reflects the initial declaration of a significant hypogene (chalcopyrite) extension of the supergene (chalcocite and copper oxide) mineralisation that comprises the current Mineral Resource. The reporting of hypogene Mineral Resource follows a four year US$30 million brownfield exploration program.

This significant Mineral Resource increase, in addition to the previously announced 129 per cent(c) increase in the Mineral Resource surrounding Escondida and a 32 per cent(c) increase in the Antamina Mineral Resource, further demonstrates the continued success of BHP Billiton's extensive brownfield exploration program. Elsewhere in the portfolio, a total of 542 thousand metres was drilled across the Pilbara in the 2011 calendar year, contributing to a 20 per cent(d) increase in the WAIO Mineral Resource to 19.3 billion tonnes(d) as reported in the 2011 Annual Report. In the Saskatchewan potash basin, BHP Billiton's activities included the completion of a 3D seismic survey and deep drilling on an exploration target, and four seismic 2D programs. In our Metallurgical Coal business, a total of 267 thousand metres was drilled across the Bowen Basin during the 2011 calendar year, increasing our confidence in the Mineral Resource underpinning our development projects including Daunia and Caval Ridge.

Mineral Resource - Spence (100%)(e)

As at 31 December 2011

As at 30 June 2011

Minerals exploration

Greenfield exploration continued on copper targets in South America, Mongolia and Zambia; nickel and copper targets in Australia. Exploration for iron ore, potash and uranium was undertaken in a number of regions including Australia, Africa and the Americas.

For the December 2011 half year, BHP Billiton spent US$532 million on minerals exploration, of which US$451 million was expensed.

Petroleum exploration

Exploration and appraisal wells drilled during the quarter or in the process of drilling as at 31 December 2011.

Petroleum exploration expenditure for the December 2011 half year was US$565 million, of which US$265 million was expensed. Our guidance for petroleum exploration expenditure for the 2012 financial year is US$1.4 billion, including the new Onshore US exploration.

(a) Facilities ready for first production pending resolution of mercury content.

(b) Excludes announced pre-commitment funding.

(c) This BHP Billiton Mineral Resource information was sourced from the BHP Billiton 2011 Annual Report. This document can be viewed at www.bhpbilliton.com. The Mineral Resource information is compiled by Richard Preece (FAusIMM) - Escondida and Jhon Espinoza (MAusIMM) - Antamina, who are full time employees of BHP Billiton and who have the required qualifications and experience to qualify as Competent Persons under the JORC Code and consent to the form and context in which it appears above. Mineral Resources are stated on a 100% basis. The detailed breakdown of Escondida Mineral Resources is 3.1bt @ 0.75% Cu Measured, 4.7bt @ 0.59% Cu Indicated, 11.7bt @ 0.49% Cu Inferred, and Antamina Mineral Resources is 187mt @ 0.85% Cu Measured, 1,019mt @ 0.91% Cu Indicated, 708mt @ 0.73% Cu Inferred.

(d) This BHP Billiton Mineral Resource information was sourced from the BHP Billiton 2011 Annual Report. This document can be viewed at www.bhpbilliton.com. The Mineral Resource information is compiled by Paul Whitehouse (MAusIMM) - Western Australian Iron Ore, who is a full time employee of BHP Billiton and who has the required qualifications and experience to qualify as a Competent Person under the JORC Code and consents to the form and context in which it appears above. Mineral Resources are stated on a 100% basis. The detailed breakdown of the Western Australian Iron Ore Mineral Resources is 2.2bt @ 59.3% Fe Measured, 3.9bt @ 60.1% Fe Indicated, 13.2bt @ 59.1% Fe Inferred.

(e) Competent Person - J. Céspedes (MAusIMM).

The statement of Mineral Resources is presented on a 100 per cent basis and is based on information compiled by the above named Competent Person and relates to Mineral Resources estimates as at 31 December 2011. Mr. Céspedes is a full time employee of BHP Billiton Limited, has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity he is undertaking to qualify as a Competent Person as defined in the JORC Code, and he is a member of the Australasian Institute of Mining & Metallurgy (AusIMM). The Competent Person consents to the inclusion in this report of the matters based on their information in the form and context in which it appears.

(f) %TCu - per cent total copper, ppm Mo - parts per million molybdenum.

(g) Spence - The inclusion of hypogene sulphide Mineral Resource is partly a result of exploration and infill drilling results, and partly a result of selection (pre-feasibility) stage studies that have demonstrated the potential of economic viability for open pit mining, milling, and flotation of the hypogene resource. Hypogene sulphides are newly reported chalcopyrite - molybdenite mineralisation that are the precursor to and immediately underlies the supergene and transitional sulphide ore types that are currently processed through heap leaching and SX-EW. The deposit has been evaluated with 108,000 meters of drill core in 264 holes located on grid spacing of 100x100 metres for Indicated tonnages and 200x200 meters for Inferred. Changes in the supergene resources compared to 30 June 2011 include additional drilling, revised pit design and depletion due to production during the first half of the 2012 financial year.

(h) BHP Billiton is operator of the well.

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