BHP is planning to increase its iron ore export capacity at Port Hedland, by about 14pc or as much as 40mn mt per year, thus increasing its share of the iron ore market.
The company is already approved to export 290mn mt of iron ore per year from its large global shipping center and is seeking approval to raise that limit to 330mn mt per year, based on 100pc capacity, according to media reports.
The license application, which the miner intends to submit in May following consultations and approvals, is a start of a multi-year process. If conditions allow, BHP wants to be prepared for future growth opportunity, per reports, despite the expectation that China’s steel output may reach its peak this year, and iron ore prices may not retain existing strength.
In the 2019 fiscal, BHP exported 238mn mt of iron ore, running at about 85pc capacity. The miner’s forecasted shipments for fiscal 2020, ending June 30, are at 273-286mn mt based on 100pc output capacity, however this guidance was provided before the spread of COVID-19 and is likely to change.
BHP also said it plans to spend up to A$300mn ($195mn) over the next five years to improve air quality and reduce dust emissions across its Pilbara integrated iron ore mining operations, in addition to A$400mn already spent during the past 10 years to lessen the release of dust throughout its supply chain.
The Port Hedland iron ore operations encompass an intricate system on seven mines and two ports in Western Australia.