BHP Group PLC (LON:BHP) said smoke from Australia’s bushfires had affected production at its coal operations in New South Wales, while production of iron ore rise less than expected in the past quarter.
Overall, however, the Anglo-Australian mining giant said it was a satisfactory finish to the first half of its financial year, with production and cost guidance unchanged for the year ahead.
READ: Analysts view copper as the “best positioned metal” for 2020
Iron ore volumes were lower at Western Australia due to the completion of a major maintenance program earlier in the quarter, with total iron ore production for the quarter down 1% on the first quarter.
Copper production was up 6% quarter on quarter but broadly unchanged in the half, with full-year volumes expected to be "slightly higher" than last year.
“All major projects under development are tracking to plan,” the company said, with six major development projects underway and exploration programs being advanced in petroleum and copper.
New chief executive Mike Henry, who officially started in the role on 1 January 2020, said: “We delivered solid operational performances across the portfolio in the first half of the 2020 financial year, offsetting the expected impacts of planned maintenance and natural field decline.
“Production and cost guidance is unchanged, and we remain on track to deliver slightly higher production than last year.”
The company said it was still “not in a position” to fully quantify the potential impacts of Brazil's Samarco disaster, albeit it has agreed to provide a further US$793m to the Renova Foundation and Samarco region.
BHP shares were down 1% to 1,818.8p as trading began in London.
Analyst Yuen Low at Shore Capital said that, generally speaking, second-quarter production was improved on the disappointing first, except that petroleum is now expected to be towards the lower end of the 110-116MMboe range.
"As a result, H1 FY20 overall came in essentially in-line with our expectations."