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FEBRUARY 12 2016 SAVE PRINT LICENSE ARTICLE

BHP Billiton Olympic Dam boss Jacqui McGill says cost-

cutting paying off
Simon Evans

HUFFPOST AUSTRALIA
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The boss of BHP Billiton's Olympic Dam copper and uranium mine says overall Buyers ...
costs are likely to be pruned by a further 10 to 15 per cent by using the heap
leach technology the company is testing, but that still requires another three to
five years of work before its ready to implement. How A New Generation Of
Small ...
But Jacqui McGill, the asset president of Olympic Dam, says there will be no
revival of any of the big-bang plans which were shelved in August, 2012 for a
$30 billion-plus expansion using an open cut mine approach.

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BHP Billiton's boss of the Olympic Dam mine says there's every reason to be confident the mine can be 5 Vicinty Centres robots as shop floor
cleaners
globally competitive and low-cost.

"It's my view that we need to take a slow and sustainable approach to growing
Olympic Dam," she told reporters after a speech to the American Chamber of
Commerce in Adelaide on Friday.

http://www.canberratimes.com.au/business/mining-and-resources/bhp-billiton-olympic-dam-boss-says-c... 6/03/2017
 Page 2 of 4
She says the heap leach technology processes that BHP Billiton has been FOLLOW BUSINESSDAY
testing for a couple of years to eventually pave the way for a more modest
expansion, require a lot more work.
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"Probably about three to five years," she says. But it will be capable of cutting a
further 10 to 15 per cent off the overall costs at the mine, outside of the sharp
cost-cutting programs that BHP Billiton has already embarked upon. FOLLOW CANBERRA TI

She says global copper prices may have a difficult time over the next 12
months. NEWSLETTERS

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"I think that we're seeing a level of supply that currently outstrips demand,"
she says. "I think that takes time to work through the system."

Olympic Dam is the fifth-largest copper deposit and the largest uranium
deposit in the world. Earlier in her speech Ms McGill said she was continuing
to target a position in the first segment of the global cost curve, as the company
pursues a slow and steady low-risk, capital-efficient expansion.

Ms McGill says the company will construct 120 kilometres of new tunnels over
the next five years and there's more work under way on cutting the cost base
further by delivering higher volumes and better efficiencies. She says unit cash
costs will be 48 per cent lower by 2016-17 compared with two years earlier
"which will take us to unit costs in the territory of US$1 per pound".

Rival Rio Tinto on Thursday announced it was scrapping its progressive

dividend policy after posting a profit of $US4.5 billion ($6.35 billion), its
lowest underlying full-year profit since 2009.

Ms McGill says the 120 kilometres of new tunnels will access the southern mine
area at Olympic Dam. This is separate to a much broader expansion.

She said overall the copper production from Olympic Dam "is now on track to
exceed 200,000 tonnes for the 2016 financial year".

Ms McGill says a major simplification process in the organisation structure,

and job cuts had reduced the total workforce by 550 people in the past year.
Workforce levels at Olympic Dam are now down to 3000 people which also
includes contractors.

"Whilst these changes were difficult, they have improved spans of control and
enabled clearer reporting lines and accountability," she said in her speech.

She says the improved results and production levels mean there has been a
solid turnaround from February 2015, when the mine wasn't profitable and had
a bleak outlook. But there has also been a cultural overhaul, with a more team-

http://www.canberratimes.com.au/business/mining-and-resources/bhp-billiton-olympic-dam-boss-says-c... 6/03/2017
 Page 3 of 4
oriented across-the-board approach. She says there needs to be a balance and
"an over-reliance on pushing for results drives a silo mentality".

The Olympic Dam mine is 560 kilometres north of Adelaide. The operations
went through three big rounds of job cuts in 2015, with 380 positions removed
in August, 140 white-collar jobs from its Adelaide corporate office in June,
following a first wave in January 2015 from the mine.

Under the original expansion plan eventually shelved in 2012, former BHP
Billiton chief executive Marius Kloppers wanted to develop an enormous open
pit where more than 400 metres of dirt and rock would have been stripped
away to get to the orebody. The company is now working on new leaching
technology to try and come up with a smaller and much cheaper approach.

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