BHP Billiton (BHP) Update

Submitted by Craig Strzelecki on 22 March, 2007 - 17:04

BHP Billiton (BHP) has a Buy 2 broker call and a share price target of $34 from stock analyst UBS. The analyst is currently on BHP Billiton's South America Trip at the Escondida Mine Site Tour; this is day 3. Day 3 of the BHP Billiton trip to Latin America took in a tour of the Escondida copper mine in Chile. Escondida is the world's largest copper mine producing 1.26Mt of copper in concentrate and cathode in aggregate in FY 06. The sulphide leach project was completed mid CY 06 and is currently in ramp up mode. Cathode production in DH 06 was 36kt or an annualised rate of 72ktpa. Production continues to ramp up with 10kt produced in Dec 06 or 120ktpa annualised. Full production capacity of 180ktpa is expected around mid 2008 according to BHP Billiton. This is based on achieving recoveries of 36%. The stock analyst envisage possible minor changes to Escondida earnings and valuation to reflect slightly lower production forecasts over the next 3 years from lower pit grades and lower oxide leach production. Nonetheless, Escondida remains a core part of BHP and a major earnings driver. Exploration prospectivity suggests that we could see production rates of >1.3Mtpa maintained for longer than we currently envisage.

BHP Billiton Limited is listed on the Australian Stock Exchange (ASX) under stock code BHP. You can view their investor website here. BHP was listed on the ASX on 13 August, 1885. Charles "Chip" Goodyear is the CEO of BHP Billiton and Don Argus the Chairman. BHP Billiton was created through the Dual Listed Companies (DLC) merger of BHP Limited (now BHP Billiton Limited) and Billiton Plc (now BHP Billiton Plc), which was concluded on 29 June 2001. BHP Billiton Limited and BHP Billiton Plc continue to exist as separate companies, but operate on a combined basis as BHP Billiton. The headquarters of BHP Billiton Limited, and the global headquarters of the combined BHP Billiton Group, are located in Melbourne, Australia. BHP Billiton Plc is located in London, United Kingdom. The company is principally involved in minerals exploration, production and processing (particularly coal, iron ore, copper and manganese ore) and hydrocarbon exploration, production and refining. Find out the meaning of the recommendations in this primer. Browse for other stockbroker recommendations. You can use Instalment Warrants to trade BHP. Check your charts and good luck with your share trading!

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