BHP says it will make a final investment decision on its long-delayed Jansen potash project by early 2021, and announced its South Flank iron ore project is now half complete.
BHP says it will make a final investment decision on its long-delayed Jansen potash project by early 2021, and announced its South Flank iron ore project is now half complete.
Investors have been awaiting a decision by the world's biggest miner on whether to go ahead with the $US17 billion ($A25 billion) Canadian potash project, which would be its most significant investment in years.
In its September production report, BHP said project planning and work to finalise a port solution was continuing and the $US5 billion-plus stage one would be presented to the board for an investment decision by February 2021.
BHP, which has already spent $US2.7 billion on Jansen, said in May it expected excess supply capacity of the crop nutrient to be used up by the middle of the next decade, while the Jansen project would create a high-margin, long-life mine.
Potash is a potassium-rich salt mainly used in fertiliser to improve the quality and yield of agricultural production.
Elsewhere, BHP posted a slight dip in its September quarter iron ore production due to planned maintenance at a key port, but maintained its FY20 iron ore production forecast.
The result was in line with analyst forecasts and came as the miner carries out ongoing maintenance at Port Hedland, the world's biggest iron ore port, which is used by three of the country's top four iron ore miners.
"Lower volumes reflected significant planned maintenance at Port Hedland, including a major car dumper maintenance program," BHP said in a statement.
BHP also announced its South Flank project in Western Australia is now 50 per cent complete.
It said 3,000 people received work on South Flank, with a total of 326 ongoing operational roles being filled to date.
To date, South Flank has awarded more than $3.5 billion of work, 78 per cent of which is Australia-based, according to BHP.
The first ore from South Flank remains on target for the 2021 calendar year
Output for the three months to September 30, BHP's first financial quarter, was 69 million tonnes, down 1 per cent on a year ago and 3 per cent on the June quarter.
Annual output is expected between 273mt and 286mt.
Iron ore prices have come off five-year highs touched in July as Brazil's Vale ramped-up production that had been curtailed by a fatal dam disaster, and Australian shipments are expected to moderate into year-end.
"Overall, a solid result for BHP with all key segments broadly in line with our estimates," RBC said in a report.
"BHP's more diverse portfolio mitigates the potential impact of falling iron ore prices...We maintain our preference for BHP over its key Australian peer Rio."
Quarterly copper output rose 5 per cent on a year ago as production recovered from outages in Australia and Chile, while metallurgical coal production fell after planned maintenance shutdowns.
Shares in BHP were down 3.3 per cent to trade at $34.86 each at the close of trade.
