BHP share price on watch after first half production update

The BHP Group Ltd (ASX:BHP) share price will be on watch after the release of a solid first half production update…

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The BHP Group Ltd (ASX: BHP) share price will be on watch on Tuesday following the release of its first half production update.

How did BHP perform in the first half?

In the first half BHP's Petroleum production came in at 57 MMboe. This was a decline of 9% on the prior corresponding period. This decline was down largely to lower gas sales at Bass Strait and Trinidad and Tobago.

The mining giant's Copper production was a highlight during the half. BHP posted a 7% increase in production to 885kt thanks to strong concentrator throughput at Escondida and higher production at Olympic Dam.

First half Iron Ore production was 2% higher than the prior corresponding period to 121Mt. This was despite lower volumes at WAIO due to a major maintenance program.

BHP's Metallurgical Coal and Energy Coal were down 2% and 12%, respectively, during the half. This follows a quarter on quarter increase in production for both commodities in the second quarter.

Nickel production also tumbled lower in the first half. Major quadrennial maintenance activities led to an 11% reduction in production during the half.

Guidance unchanged.

The company's new CEO, Mike Henry, was pleased with the first half performance.

He said: "We delivered solid operational performances across the portfolio in the first half of the 2020 financial year, offsetting the expected impacts of planned maintenance and natural field decline."

Mr Henry also revealed that BHP is on track to achieve its production and cost guidance for the full year.

"Production and cost guidance is unchanged, and we remain on track to deliver slightly higher production than last year. Our six major development projects are progressing well, and we continue to advance our exploration programs in petroleum and copper," he said.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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