Bhp Group Ltd · ASX:BHP
Bhp — BHP Billiton — Corporate Update (November 2008)
67 slides from Bhp's corporate update, Nov 3, 2008
Slide 1: Form 6-K Report of Foreign Private Issuer
UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 6-K REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934 November 3, 2008 BHP BILLITON LIMITED BHP BILLITON PLC (ABN 49 004 028 077) (REG. NO. 3196209) (Exact name of
Slide 2: Australian Site Tour Olympic Dam, 31 October 2008
Australian 31 OctoberSite 2008Tour Olympic Dam
Slide 3: Disclaimer
Reliance Disclaimer or Forward This Billiton. our of Securities No Nothing Resources Cautionary extract. material most Competent the has Shane Mineral Slide warranty our AusIMM offer control, been presentation recent 2annual O’Connell Certain Resource. denoted to in These looking of reported on and
Slide 4: Agenda
Introduction Agenda Current Market Olympic Strong Slide 3 Future Business Dam&for Expansion Olympic Performance the Uranium Dam Resource Business
Slide 5: Introduction: Uranium and Olympic Dam
Introduction Graeme President Hunt Uranium & Olympic and Olympic Dam Resource Dam Development
Slide 6: Introduction: Key Points
Introduction •Key Slide The Work Safety Points 5current isisprogressing ourand business Key Resource Priority on is performing the Olympicstrongly Dam Expansion Study
Slide 7: Olympic Dam and Uranium team
One Marius -Graeme Dean President Olympic Ted Project Corporate Richard Manager Andrew Technology Marketing John •Chief – Note: Slide President 33 231 38 12 25 16 23 Director, Previously Asset VP Team Project Manager Chief Global Marketing years Bassett years co-ordinated Crofts1 Capital 6Dalla Tech
Slide 8: Olympic Dam resource compared with world deposits
Thousand 2,500 Elkonsky McArthur Imouraren Cigar Viken Inkai Largest Mynkuduk Jabiluka Streltsovskoye 120 El Andina Chuquicamata Olympic Oyu Collahuasi Grasberg Escondida Norilsk Lubin Million 250 ~1,100 4th Sources: Witwatersrand Slide Teniente largest 100 200 Tolgoi 7Lake 2,000 #uranium (Nickel) t
Slide 9: Olympic Dam multi-generational resource
AExcludes Olympic 8,339 2.33 Existing Mineral 9,000 Inferred 2005 * Sources: Slide multi-generational Mt 2006 88,000 MtResource Contained Indicated Operation BHP Dam Resource 2007* Non 7,000 Billiton Resource Sulphide 2008* (Mt) Measured 6,000 U3O8 inbusiness our annual 5,000 Au backyard resource re
Slide 10: Copper Market
Copper John ChiefCrofts Commercial Market Officer
Slide 11: Copper: Key Points
Copper •Key Slide Advantageous BRICs Supply Low Points 10 stocks Market development interruptions andindustry no significant underpinned (now) economics. andrate constrained by of Lowenergy ingress price growth &thus elasticity infrastructure far(future) of demand a build differentiator out in key a
Slide 12: World copper demand growth
World Reconstruction (Mt) 20 Post-war 4.5% US Industrialization Stagnation Global 2.1% reduces Oil demand Demand Rapid China shortages Source: 2005 2000 1995 1990 1985 1980 1975 1970 1965 1960 1955 1950 3.3% Slide 18 shocks Government 11 16 growth causing 1997 copper refined recession World global g
Slide 13: Copper consumption per capita vs GDP
Copper (kg 20 5 0 Source: Note: China Slide ,000 015 / capita) 12 The 10 10,000 Germany –World Consumption GDP shape 15,000 Bank, per India of capita the 20,000 Government Japan arrow vs Korea, consumption 25,000 shows Statistics, Rep. 30,000 the general United per 35,000 CRU, capita trend States 40
Slide 14: Future supply disruption expected
Future Disruption Expected 8,000 (kt) 2-3 Forecast Source: 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 Note: excludes Slideyear 13 “Forecast 7,000 supply Brook delays production new future a6,000 feature developments growth: Hunt. production 5,000 as of at new 4,000 2006 2008 as from
Slide 15: Supply side challenges
Supply Existing Future •– Slide Industrial Labour Significant Energy Declines Infrastructure Developments Equipment Rising Resources Smaller Lower Higher 14Supply side tariffs capital Supply grade and shortages risk inaction constraints nationalism stress shortages cost ore-grade power geographies G
Slide 16: Copper price and exchange stocks
Exchange Copper LME ($/t C 100,000 200,000 300,000 400,000 500,000 600,000 700,000 800,000 Jan-04 S 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 Slide ource: omex Nominal) 15 Cash Apr-04 SHFE London Stocks price LME Jul-04 Metal (t) LME Oct-04 Exchange Cash Jan-05 (RH) (LME), Apr-05 Shang
Slide 17: China copper raw material supply
China Copper (kt 5,000 2 0 2008 Domestic Scrap Net Imported Source: 21% 29% Note: Slide 004 Cu Imported estimate 16 Data 4,500 copper contained) raw BHP Concentrates Mine assumes materials 4,000 Billiton, Cathode raw material 3,500 imported 2008 Customs 3,000 requirements estimates concentrate 2,500
Slide 18: Indian copper consumption
Indian Copper 2008F (kt) Enabling Generation Reform 1 0 300 600 900 1,200 1,500 1,800 1970-1979 1980-1989 1990-1999 2000-2009 Sources 2020F 2015F 2010F 2005 2000 1995 1990 1985 1980 1975 1970 1965 1960 Slide 960-1969 17 copper –consumption Program of 2020F policies data: -2.2% 2.4% 6% 9.4% 9.9% capa
Slide 19: Selected copper applications and substitution
Results applications Selected which demand % 21 14 11 10 7 2 share 6 5 4 Commercial Building Electrical/Electronic Industrial Electric 2006 of Plumbing = of14 Network 14 motors CU wire of power Mt Mt Automotive Utility Telecom tube Selected tube power Substitution cable cablewire Power/distribution
Slide 20: Uranium Market
Uranium John ChiefCrofts Commercial Market Officer
Slide 21: Uranium: Key Points
Uranium •Key Slide Real Security Supply Nuclear Points 20 impact side Market cost of supply response of competitiveness Climate keychallenges for Change BRICs onstill (near the to rise term come – priced &&future) meaningful carbon & reduced options are capital limited intensity (China) are further
Slide 22: Primary energy use vs GDP per capita
Primary (tonnes C 2 4 6 8 10 5 0 GDP/Capita 50,000 45,000 40,000 35,000 30,000 25,000 20,000 15,000 10,000 Source: Note: Slide ,000 hina21 The Germany of World energy shape oil(Jan. equiv/capita) Bank, consumption use India of2008 theGovernment Japan arrow Constant Korea, is shows strongly US Statis
Slide 23: China's growing power output
China’s (in Power UK’s 3,500 426 400 1 0 Source: 2007 2006 2005 2004 2003 2002 2001 2000 Slide 999 billion 22 total 3,000 output National power Growing kWh) power 2,500 added output Bureau Power output 2,000 from is annually Output today 1,500 of previous Statistics 1,000 growing year 500 of China b
Slide 24: China's nuclear programme
China China’s Current – Slide Current Latest Recent In First 11 16 2007, reactors 23isreactor nuclear announced only purchase share China operational under just onof projects programme: added commercial starting nuclear ofconstruction target reactors 80 in atto ofgeneration GWe China: 4develop 70 si
Slide 25: China nuclear industry cooperation
Ling Ao: Taishan Source: Shanghai Dongfang Harbin China Shenyang Sichuan Slide 24 isElectric: Nuclear BHP project Sanzhou: preparing two Electric: Blower Electric: Billiton new Energy ready partnership Works: produces reactors partnership for partnership China for aapplied major foundation tobeing c
Slide 26: Nuclear capacity in China
•Nuclear Currently Source: Slide Current Increasing 25http://www.insc.anl.gov/pwrmaps/map/china.php growth nuclear operating number incapacity China Under of planned isand construction notcapacity restricted and proposed under Planned to coastal reactors construction / proposed areas in landlocked a
Slide 27: China aluminium and steel growth
25.0 20.0 China 2000 China’s (Million 1400 World 1997 2002 40% Sources: Source: Slide 30% 2001 1200 1998 2003 26 Aluminium has ex-China International share tonnes) Brook 15.0 20% demonstrated 2002 1000 1999 2004 of10.0 10% Hunt China world crude 2003 800 2000 2005 Production 5.0 0% 600 Aluminium Iro
Slide 28: China construction and delivery times
….and China Shangdong province East Alumina Jinbei 400kt/yr Kaiman time 40 60-66 Copper US$5000/t engineering Source: Slide Months Months, Hope 10 27 Months Alumina Western shown smelters months BHP alumina alumina construction refinery time 800kt/yr + installed 3500kt/yr Greenfields through Billito
Slide 29: Short supply: uranium supply and demand outlook
Short WNA (kt 400 MOX HEU What 2008F An 2,000 (GWe) 1,200 2008 1,634 960 372 * Source: Association Slide BHP u3o8) external 350 installed 28 if to 1,600 800 supply &2009F Billiton the International medium 300 RepU 400 world view (AUA) 250 and 2010F capacity 0other analysis term 200 demand goes Outlo
Slide 30: Short supply: recent events
Short Supply •Recent Slide Kazakhstan Cigar Dominion India Combined UK energy 29 togranted events Lake developments medium –Construction white ––care in uncertainty exemption upside the term and paper nuclear and market surprise maintenance reversal and events by onindustry NSG start-up outlook Oper
Slide 31: Uranium legacy sales portfolio
•Legacy Uranium (% 100 rest FY Note: Sales Slide Current BHP of 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2009 of 9030 data Production forecast Billiton FY 80 fixed fixed “legacy” 70 2010 includes sales 60production) does sales 50 data portfolio position only 40 not commitments includes
Slide 32: Olympic Dam expansion uranium marketing
•Olympic – Slide BHP Aggregate A Pricing BHP portion 31 Billiton Billiton Dam mechanism ofmarket the Expansion has intends is actively volumes agreed interest will to put -be engaging 10 in Uranium isdesigned in term these well place sheets in contracts with marketing aexcess toportfolio its capture
Slide 33: Current Business Performance
Current Paul Vice Dunn President Business Finance Performance
Slide 34: Current Business Performance: Key Points
Current •Key Slide Experienced Safety Sustainable Points 33Business the driver improvement teamPerformance for leading cultural in theperformance change turnaround in performance
Slide 35: An experienced team
An Dean President Barry Justin Giles John Vice Paul Kym VP Gary -•Client Slide Asset VP Perilya Barrack Senior Operations Production Finance Project U/G Manager National Government Chief Operational 231years 33 632 24 30 Previously 16 310 722 23experienced Processing Smelter Maintenance Health Busin
Slide 36: Olympic Dam site layout
Site 1 Tailings Underground Quarry Evaporation Process Phase Slide kilometre Layout 35 1 Plant Open Storage Ponds Mine PitFacility
Slide 37: Olympic Dam underground mine layout
Olympic Slide 36 Dam Underground Mine Layout
Slide 38: Process plant layout
Process 200 Smelter Hydromet Refinery Concentrator Slide metres 37Plant &&Acid Gold Layout Plant Room
Slide 39: Olympic Dam copper C1 cost curve
2008 C1 (US¢/lb OLYMPIC 0 Cumulative Source: Slide 2,000 Cash Copper 384,000 Brook Cu) Cost DAM Cu 175 Supply 6,000 (Brook Hunt Production 1508,000 2008 Cost 125 Hunt100 Production Curve 10,000 (kt) Normal 75 50 12,000 Costing) 25Cost 0 -25 14,000 League -50 -75 -100
Slide 40: Olympic Dam uranium supply cost curve
2008 Uranium 50 OLYMPIC 0 Tonnes Source: Slide 10,000 45Uranium 39 40U3O8 NAC 35 20,000 Supply DAM 30International, Supply 25 30,000 (US$/lb) 20 15 Cost 40,000 10 Curve 5estimated 0 50,0002008. 60,000 70,000 80,000
Slide 41: What drives value at Olympic Dam?
WhatThroughput Economic Mine Ore Smelter Copper Zero Slide Harm 40 Capacity Drives Price Capacity Value People Value Metal Mill Drivers Metal Planning atPrices Capacity Olympic Production Supported Contract Dam? Copper by Price &Grade VolumeMetal Uranium Grades Price Value Spot Uranium Price &Grade
Slide 42: High priority areas since acquisition
HighThroughput Economic Mine Ore Copper Zero Slide Planning PeopleHarm Priority 41 Capacity Price Value Metal Areas Mill Drivers Prices since Capacity Supported Acquisition Contract Smelter by Price Capacity & Volume Metal Uranium Production PriceCopper Spot Price Grade & Volume Metal Grades Operati
Slide 43: Zero harm to people: safety performance
High Supported Total (per 40 30 A •-0 Zero Slide Planning People Uranium >pr-06 Clear Incentive Co-operative Implement Improved Existing Expansion Business change 20 50 million Harm Priority Recordable 42 10 BHP accountability Jun-06 business by Business Improvement program understanding Billiton ho
Slide 44: Economic value drivers: mine and mill production
High Economic Annual Ore -•Material Mine (mt) 16 14 12 10 8 9 4 2 7 D 6 Nov-06 Developed Sources: Slide Advanced Restore Focus Reliability Improve ec-02 2.0 1.5 1.0 0.5 4.0 3.5 3.0 2.5 Hoisted Copper 8Priority 43 Stocks 11 Apr-03 Record on Jan-07 Milled BHP &mill mine Value bottleneck and control gr
Slide 45: Uranium recovery improvement
High •Economic FY06 80 Uranium 70 65 60 55 50 45 40 Before Sources: Slide Uranium Improved 0.80 0.70 0.65 0.60 0.55 0.50 0.45 0.40 Priority 44 FY07 Uranium Jul-05 BHP Recovery oxide recovery Value recovery process FY08 Areas Billiton Sep-05 (%) Recovery Drivers 75 Future (ex optimisation (U3O8 since
Slide 46: Operating cost structure and exchange rates
Recent 2008 ($ 10,000 1.40 8,000 1.20 Royalties 5% 4,000 0.80 2,000 30% US$/tonne US$/A$ 0 •1-Jan-08 Sources: Slide Approximately Exchange 0.50 ) 6,000 Labour 24% 19% Daily 45 1.30 0.90 0.70 Contractors 1.50 copper 0.60 London 31-Jan-08 1.10 14% Consumables Copper rate Maintenance price Administrati
Slide 47: Moving forward: priority areas
Moving Zero People – •Uranium Slide Water Transition Talent Good Energy Smelter Employee Uranium Geometallurgy Build Integration Regional 60 days Relining Modifications Harm 46safety on efficiency Pipeline Forward efficiency Recovery outage Sept planning leach both exploration –value organisation of
Slide 48: Olympic Dam Expansion
Olympic Ted 31 October Bassett Dam 2008 Project Expansion Director
Slide 49: Olympic Dam Expansion: Key Points
Olympic •Key Slide Configuration Utilising Politically Environmental Focus Points 48onDam asimplicity stable staged Expansion established Impact environment expansion & preservation Statement path to of befuture issuedoptions to government before the end of 2008
Slide 50: Project team
AAssistant Ted Project Jon Dave Rob DPD Graham Michael -•Manager Notes: Slide VP WMC Operations Project General Principal GM Newmont Minera 38 815 324 217 20 team yrs years Gilligan Bassett yrs years Williams Capital Mine Infrastructure Operational 49 Thomas Gympie project DPD Director with Manager
Slide 51: Staging and delivery
Staging (2B). Delivery Stage capacities. Slide 50 Cu 54321 Expand Optimise Develop reduces of concentrate Low Stages Cu:S the to risk 20 the 40 60 3existing Mtpa and &sold existing Cu Mtpa 4 allows concentrate coincide. open tothe OD China operation. open pit integration smelter ore smelter. pit sol
Slide 52: Conceptual staged expansion
The Concentrating CONCEPTUAL Mining Cu Hydrometallurgy 10Mtpa 1 Brown-fields 2 +3Mtpa 20Mtpa Expand Green-fields Further Notes: + +20Mtpa Slide Optimise concentrator Further U308 proposed 51Unless expansion Smelting on open 0+2Mtpa 52Mtpa Au (200ktpa 3 (800ktpa growth Current site underground 350 4(
Slide 53: Estimated final pit scale versus Escondida
Scale:52 Estimated Depth: Final Slide Pit A1,220 1,055 885 very 1 Olympic Escondida km mmlarge open Dam Mine pitFinal Pit
Slide 54: Olympic Dam resource grade shells
Olympic U3O8 Pit Slide @53 100 >300ppm Dam yrs Resource Au >0.3g/t Cu >0.5% Cu >1.0% Cu >2.0%
Slide 55: Five-fold simplification of processing
Five-fold Simplification: Existing New Processing Notes: Slide Process 541-Process Potential increase Facility Plant Plant in capacity 60 after ore Mtpa 12Stage volume, Mtpa1 after 5 optimisation, doubling of plant current footprint capacity 10Mtpa.
Slide 56: Process plant staging
Process Stage Slide 55 2 Stage Plant Project 4 StageStaging 5
Slide 57: Shipping and final transport
Shipping 2 1 Australia, Final Transport Note: AMSA Slide Commercial process 56 ASNO – Australian copper concentrate in front –report agreement Australian concentrate ofhanded Maritime figures) across needed Safeguards toand the schedule: Safety ASNO seas, not to import cathode Authority. and 3in fro
Slide 58: Autonomous mining technology
Autonomous Why? Technology •BHP Slide Autonomy Technology Truck Potential Reduced DARPA Development Extensive Billiton 57testing Urban mining step pilot trials Mining isstarted contract change well Challenge program at cost aadvanced. Systems number atinsigned Caterpillar risk planned exposure of wi
Slide 59: Environmental approvals timeline
Environmental First Public Submit •Ministers’ Federal South Northern Slide Approving Documentation Subject release 58 Australia display response – Territory to Environment decisions above to Ministers April/May Governments Impact –document completed Planning review – Feb Infrastructure Statement Min
Slide 60: Project stage schedule
•Project Slide Stage EIS Development Ore 59 Processing approval 1Schedule in production to ofexpansion take openbetween by pit 2013 todeveloped take 12 5and years 18 in three months stages
Slide 61: Strong Future for the Uranium Business
Strong Future Graeme President Hunt Uranium for the and Uranium OlympicBusiness Dam Development
Slide 62: Yeelirrie: good news
Yeelirrie: Good Yeelirrie Leinster Kalgoorlie Fremantle Concentrator Kwinana Esperance •What’s Slide Australia’s Approximately 130km 100% Discovered State Upgrade Update 61 news agreement Next? BHP Nickel North feasibility Nickel Aresource Port Nickel large second Billiton inRavensthorpe of early Re
Slide 63: Yeelirrie overburden thickness
Yeelirrie Relative Overburden Slide 62 surface is flat thickness and level the(m) deposit shallow
Slide 64: Yeelirrie previous drilling outline
Yeelirrie Previous Outline U308 1000m Slide 63 Grade ofis Drilling 50m well Profile grid drilled (g/t) (Class and 1) has great grades, further work required to develop JORC compliant resource
Slide 65: Key Messages
Key •– Slide Yeelirrie We Longer Olympic Will Messages have 64 support term is aDam experience strong another demand a is multi-generational ateam unique good outstanding inoutlook large managing business resource projects is long strong today our business term and uranium integrating opportunity bu
Slide 66: BHP Billiton: the future resourcing
bhp billitonthe future resourcing
Slide 67: Signatures
SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. BHP Billiton Limited and BHP Billiton Plc Date: 3 November 2008 By: Jane McAloon Name: Jane McAloon Tit