BHP has adjusted its full-year outlook for metallurgical coal as tough conditions continued. The metallurgical coal guidance has been reduced as a result of significant wet weather impacts and COVID-19 related labor constraints. Metallurgical coal production for the full year is now targeted at between 38 million and 41 million metric tons (mt), down from the previous estimate of between 39 million and 44 million mt.
Metallurgical coal production for the December quarter was stagnant compared with the previous quarter, reaching 8.8 million mt, but down 8% in the half-year, to 17.6 million mt.
BHP reported that Queensland coal production decreased due to significant wet weather, with double the amount of rainfall, coupled with COVID-19 related labor constraints impacting stripping and mine productivity across most operations. A longwall move was successfully executed at Broadmeadow and the Caval Ridge wash plant maintenance was also completed on time during the December quarter.
Following the recent easing of Queensland’s border restrictions, COVID-19 related absenteeism has increased and remains a risk for the remainder of the year.
Meanwhile, energy coal production was down 30% in the December quarter, compared with the September quarter, reaching 2.9 million mt, while half-year production was up 5%, to 7.2 million mt.
Energy coal production was impacted by significant weather events during the quarter under review, with BHP reporting three times the amount of rainfall in this quarter, which impacted stripping and mine productivity. This was partly offset by mining in lower strip ratio areas.