BHP Billiton expects oil and gas markets to improve over the next 12 to 18 months.
“We have seen early signs of markets rebalancing,” says CEO Andrew Mackenzie. “Fundamentals suggest both oil and gas markets will improve.”
A short time ago, BHP’s shares were down 0.9% to $22.43.
Mackenzie, releasing the mining giant’s latest quarterly production report, also says iron ore and metallurgical coal prices have been stronger than expected.
However, BHP still expects supply to grow more quickly than demand in the near term.
BHP’s total iron ore production for the September quarter was unchanged at 58 million tonnes.
And mining and processing operations at the Samarco mine in Brazil are still suspended following the fatal dam disaster in November last year.
“Together, the combination of steadier markets, continued capital discipline, improved productivity and increased volumes in copper, iron ore and metallurgical coal should further support strong free cash flow generation this financial year,” he says.
BHP says full year production and cost guidance remains unchanged.
However, guidance for the Olympic Dam copper, gold and uranium mine is under review following a state-wide power outage in South Australia.
Here’s a summary of BHP’s September quarter production: