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
March 24, 2011
| BHP BILLITON LIMITED | BHP BILLITON PLC | |
| (ABN 49 004 028 077) | (REG. NO. 3196209) | |
| (Exact name of Registrant as specified in its charter) | (Exact name of Registrant as specified in its charter) |
| VICTORIA, AUSTRALIA | ENGLAND AND WALES | |
| (Jurisdiction of incorporation or organisation) | (Jurisdiction of incorporation or organisation) | |
| 180 LONSDALE STREET, MELBOURNE, VICTORIA 3000 AUSTRALIA |
NEATHOUSE PLACE, VICTORIA, LONDON, UNITED KINGDOM | |
| (Address of principal executive offices) | (Address of principal executive offices) | |
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:
Form 20-F x Form 40-F ¨
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ¨
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ¨
Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934:
Yes ¨ No x
If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): n/a
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: March 24, 2011 | By: | /s/ Jane McAloon | ||
| Name: | Jane McAloon | |||
| Title: | Group Company Secretary | |||
Iron ore and coal
Investing in high quality growth
Marcus Randolph
Group Chief Executive, Ferrous and Coal
March 2011
bhpbilliton
resourcing the future
Disclaimer
bhpbilliton
resourcing the future
Reliance on Third Party Information
The views expressed herein contain information that has been derived from publicly available sources that have not been independently verified. No representation or warranty is made as to the accuracy, completeness or reliability of the information. This presentation should not be relied upon as a recommendation or forecast by BHP Billiton.
Forward Looking Statements
This presentation includes forward-looking statements within the meaning of the U.S. Securities Litigation Reform Act of 1995 regarding future events and the future financial performance of BHP Billiton. These forward-looking statements are not guarantees or predictions of future performance, and involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, and which may cause actual results to differ materially from those expressed in the statements contained in this presentation. For more detail on those risks, you should refer to the sections of our annual report on Form 20-F for the year ended 30 June 2010 entitled “Risk factors”, “Forward looking statements” and “Operating and financial review and prospects” filed with the U.S. Securities and Exchange Commission.
Exploration Results, Mineral Resources and Ore Reserves
This presentation includes information on Exploration Results, Mineral Resources and Ore Reserves, which is based on information prepared by the relevant Competent Persons as named in the 2010 Annual Report, and reported under the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’ (the JORC Code). The Competent Persons for Exploration Results are J. Knight (Western Australia Iron Ore – MAIG), A. Paul (Queensland Coal – MAusIMM), D. Dunn (Queensland Coal – MAusIMM) and P. Grey (Hunter Valley Energy Coal – FAusIMM). The Competent Persons verify that this report is based on and fairly reflects the information in the supporting documentation and agree with the form and context of the Exploration Results, Mineral Resources and Ore Reserves presented. The Competent Persons are full time employees of BHP Billiton and have the required qualifications and experience to estimate and report Exploration Results, Mineral Resources and Ore Reserves under the JORC Code. The relevant details of the Competent Persons can be found at: www.bhpbilliton.com.
No Offer of Securities
Nothing in this presentation should be construed as either an offer to sell or a solicitation of an offer to buy or sell BHP Billiton securities in any jurisdiction.
Non-GAAP Financial Information
BHP Billiton results are reported under International Financial Reporting Standards (IFRS). References to Underlying EBIT and EBITDA exclude any exceptional items. A reconciliation to statutory EBIT is contained within the profit announcement, available at our website www.bhpbilliton.com.
Iron ore and coal – Investing in high quality growth, March 2011 Slide 2
Iron ore and coal – our global operations
bhpbilliton
resourcing the future
Underlying EBIT
(H1 FY11, US$ billion)
15
10
Energy Coal
Metallurgical Coal
5
Iron Ore
0
Underlying EBIT1
(H1 FY11)
EBIT Margin ROA
Western Australia
Iron Ore US$5.3 billion 64% 48%
Queensland Coal US$1.3 billion 39% 38%
Hunter Valley
Energy Coal US$0.2 billion 27% 12%
Energy Coal
Iron Ore
Metallurgical Coal
<US$500m EBIT
US$501m – 1,000m EBIT
>US$1,000m EBIT
1. Excludes third party trading.
Iron ore and coal – Investing in high quality growth, March 2011 Slide 3
Investing in our Tier 1 businesses
bhpbilliton
resourcing the future
Western Australia Iron Ore
Scope: Develop capacity in excess of 220mtpa with debottlenecking opportunities to 240mtpa
Cost: US$6.6 billion (BHP Billiton share), excluding US$2.3 billion in pre-approval funding
Initial production date: Q1 CY14 (Jimblebar)
Queensland Coal
Scope: 4.9mtpa mine and 11mtpa port expansion including risk mitigation
Cost: US$2.5 billion (BHP Billiton share), excluding US$0.2 billion in pre-approval funding
Initial production date: CY13 (Daunia)
Hunter Valley Energy Coal
Scope: 4mtpa run-of-mine expansion at Mt Arthur Coal
Cost: US$0.4 billion (100% BHP Billiton)
Initial production date: H2 CY13
Iron ore and coal – Investing in high quality growth, March 2011 Slide 4
Large resources underpin significant growth
bhpbilliton
resourcing the future
Reserves, Resources and Potential Mineralisation
(FY10, billion tonnes)
Potential Mineralisation
75 Resource
Reserve
200+ 100+ I Potential Mineralisation range
60
Minimum inventory life
(years)
45
30
100+
15
0
Western Australia Iron Ore Queensland Coal Hunter Valley Energy Coal
Potential Mineralisation, Mineral Resources and Ore Reserves are stated on a 100% basis. The detailed breakdown of Resources and Reserves are shown in the FY10 Annual Report.
Potential Mineralisation (Exploration Targets) is estimated from geological information including boreholes, outcrops and geophysical information, and is shown as a range (black bars). The potential quantity is conceptual in nature, there has been insufficient exploration to define a Mineral Resource and it is uncertain if further exploration will result in the determination of a Mineral Resource. It should not be expected that the quality of the Potential Mineralisation is equivalent to the Resource.
Realistic global mining and processing conversion factors have been used for each asset to determine the minimum inventory life, based on FY10 production. In Basins (Pilbara, Bowen) the life of individual mines may be more or less than the number stated above.
Iron ore and coal – Investing in high quality growth, March 2011 Slide 5
Western Australia Iron Ore
bhpbilliton
resourcing the future
Port Hedland
Outer Harbour
Finucane Island
Nelson Point
Boodarie
YARRIE
Port Hedland
Newman
Railway
0 100km
MARILLANA
BHP YANDI
MAC
MUDLARK
JINIDI
SOUTH FLANK OB 23/25 JIMBLEBAR
NEWMAN OB 18
EXISTING WHEELARRA
FUTURE
Western Australia Iron Ore (WAIO)
Integrated system of seven mines
More than 1,000 kilometres of rail infrastructure
Expandable port facilities
Increasing capacity to +220mtpa
Debottlenecking opportunities to 240mtpa for incremental capital investment
Future options for significant expansion beyond the inner harbour
Iron ore and coal – Investing in high quality growth, March 2011 Slide 6
Investing in our export infrastructure
bhpbilliton
resourcing the future
Wharfs and berths
4 km jetty
New stockyards
Car dumper 5
Conveyors to Finucane Island
Boodarie stockyards
FINUCANE ISLAND
NELSON POINT
BOODARIE
bhpbilliton
resourcing the future
Existing
155mtpa to +220mtpa investment
Outer harbour
New stockyards
4 x shiploaders and berths
Iron ore and coal – Investing in high quality growth, March 2011 Slide 7
Well positioned to accelerate WAIO production growth
bhpbilliton
resourcing the future
WAIO production profile
(mtpa, 100%)
400
350
300
250
200
150
100
50
0
FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20
FY10-FY20
CAGR 10%
Future growth options including the outer harbour development
+220mtpa investment
Existing capacity
Source: BHP Billiton analysis.
Note: All studies and estimated capacity remain under review until they are approved for execution.
Iron ore and coal – Investing in high quality growth, March 2011 Slide 8
Ideally positioned on the cost curve
bhpbilliton
resourcing the future
Cost curve for iron ore fines
(US$ per tonne CIF China)
160
120
80
40
0
0
BHP Billiton
350 700 1050 1400
Cumulative volume
(million tonnes)
Source: Macquarie Research, March 2011.
Iron ore and coal – Investing in high quality growth, March 2011 Slide 9
Industry wide capital cost inflation
BHP Billiton is not immune to that trend
bhpbilliton
resourcing the future
Indicative capital intensity – WAIO
(US$ per annual tonne)
240
45
195
12
183
Growth capital (155mtpa to +220mtpa)
Debottlenecking option to 240mtpa¹
Adjusted growth capital
(155mtpa to 240mtpa)
Simplification (port blending and Mooka rail yard)
Underlying capital intensity (155mtpa to 240mtpa)
1. Debottlenecking refers to capacity gains at Jimblebar and Port Hedland for incremental capital investment (of ~US$1 billion).
Iron ore and coal – Investing in high quality growth, March 2011 Slide 10
Queensland Coal
bhpbilliton
resourcing the future
BHP Billiton Abbot Point Terminal (X80)
Abbot Point
Bowen
BMA MINE / PORT
BMC MINE
FUTURE MINE / PORT
Collinsville
0 100km
Mackay DBCT
WARDS WELL Hay Point
GOONYELLA RIVERSIDE BROADMEADOW U/G
SOUTH WALKER CK
Moranbah DAUNIA
POITREL
CAVAL RIDGE PEAK DOWNS
SARAJI EAST
SARAJI
Dysart
NORWICH PARK
GREGORY CRINUM
Rockhampton
Emerald Blackwater
BLACKWATER
Gladstone
BHP Billiton Mitsubishi Alliance (BMA)
BHP Billiton (50 per cent)
Mitsubishi Development Pty Ltd (50 per cent)
The world’s largest exporter of seaborne metallurgical coal
BHP Mitsui Coal (BMC)
BHP Billiton (80 per cent)
Mitsui and Co. Limited (20 per cent)
Hay Point Coal Terminal wholly owned by BMA
Expansion from 44mtpa to 55mtpa
Future development options at Abbot Point (X80)
Iron ore and coal – Investing in high quality growth, March 2011 Slide 11
The premier metallurgical coal business
bhpbilliton
resourcing the future
Seaborne metallurgical coal producer operating margin
(2016, US$ per tonne FOB)
Queensland Coal
0 50 100 150 200 250 300 350 400
Cumulative volume
(million tonnes)
Source: Wood Mackenzie November 2010 Cost Data and BHP Billiton analysis.
Note: Queensland Coal based on internal production profile at weighted average Wood Mackenzie operating margin for Queensland Coal assets. Metallurgical coal prices used (real): US$200/t (HCC), US$150/t (WCC), US$90/t (Thermal). Exchange rates: A$/US$ 1.30, C$/US$ 1.04, CNY/US$ 5.2, BWP/US$ 7.2, R/US$ 8, NZ$/US$ 1.65, RBL/US$ 27.5, VND/US$ 23,170.
Iron ore and coal – Investing in high quality growth, March 2011 Slide 12
Hay Point – a strategic asset for the long term
bhpbilliton
resourcing the future
EXISTING WORK UNMODIFIED HPX3 WORKS
NEW WORK HPX3
DEMOLITION WORK HPX3
Expansion from 44mtpa to 55mtpa
Modification of existing infrastructure to mitigate risk
Scheduled for completion in CY14
Options for future expansion
Tropical Cyclone Yasi (Indicative)
16.5m
Tropical Cyclone Ului
11.5m
Highest tide level
7.14m
Existing trestle New trestle
Iron ore and coal – Investing in high quality growth, March 2011 Slide 13
Industry wide capital cost inflation
BHP Billiton is not immune to that trend
bhpbilliton
resourcing the future
Capital intensity – metallurgical coal
(US$ per annual tonne)
700
600
500
400
300
200
100
0
2000 2002 2004 2006 2008 2010 Unapproved projects
BHP Billiton
Non BHP Billiton
Daunia
Brownfield expansion options at the start of the decade delivered ‘cheaper’ tonnes
Capital cost inflation is evident across the industry
BHP Billiton is well positioned with its multi-decade coking coal resource, high margin product and strategic export infrastructure
Source: Company announcements and BHP Billiton analysis.
Note: Bubble size represents annual production capacity. Placement of unapproved projects not indicative of timing.
Iron ore and coal – Investing in high quality growth, March 2011 Slide 14
Numerous options for growth
bhpbilliton
resourcing the future
Metallurgical Coal production profile
(mtpa, BHP Billiton share)
70
60
50
40
30
20
10
0
FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20
FY10-FY20
CAGR 6%
IndoMet Coal Stage 11
Illawarra Coal
BMC
BMA
Current operations
1. IndoMet Coal Stage 1 conceptual development, excludes growth beyond Stage 1.
Note: All studies and estimated capacity remain under review until they are approved for execution.
Iron ore and coal – Investing in high quality growth, March 2011 Slide 15
Investing in high quality growth
bhpbilliton
resourcing the future
BHP Billiton’s large, low cost resource basins in Iron Ore, Metallurgical Coal and Energy Coal can support multiple major expansions
Capital cost inflation is an industry wide trend and consistently lags the commodity price cycle – BHP Billiton has taken a prudent approach to cost escalation
Our strategy in Western Australia Iron Ore is to maximise capacity in the inner harbour while accelerating development of the outer harbour
Our strategy in Queensland Coal is to rapidly grow production from our large, high quality resource by leveraging our valuable infrastructure
Our strategy in Energy Coal is to grow Hunter Valley Energy Coal to match its Newcastle port allocation
Iron ore and coal – Investing in high quality growth, March 2011 Slide 16
bhpbilliton
resourcing the future