No end in sight for iron ore supply glut, BHP warns

By Oliver Haill

Date: Wednesday 29 Mar 2017

No end in sight for iron ore supply glut, BHP warns

(ShareCast News) - BHP Billiton iron ore chief Edgar Basto has warned that the supply of low-cost seaborne iron ore is expected to grow faster than demand, but assured that company is well-positioned to continue to grow value and shareholder returns.

With its Yandi mine in central Pilbara due to be depleted over the next five to 10 years, he said the company's preferred long-term solution replacement was a mine at South Flank.

Running at 100% capacity, Yandi achieved record production of 136m tonnes in the six months to December.

With the completion of the rail renewal and maintenance program in the last quarter of the 2017 financial year, which is running six months ahead of schedule, coupled with the ramp-up of additional capacity at the Jimblebar mining hub and ongoing productivity improvements, WAIO is expected to deliver an increase in its system capacity to 290m tonnes per annum in the 2019 financial year.

Basto said the investment case for using South Flank's high-grade deposit for replacement tonnes "is strong", given BHP Billiton's ability to utilise existing infrastructure.


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