BHP's Samarco JV Expected to Meet Settlement Obligations Once Production Recovers -- Market Talk

Dow Jones10-28

0229 GMT - BHP is expected to need to help support its Samarco iron ore joint venture with Vale over the next few years, says Citi analyst Paul McTaggart, after the miners reached a US$32 billion settlement with Brazilian authorities over a 2015 dam collapse. In a few years' time, Samarco should be able to meet the obligations set out under the settlement, McTaggart notes. The JV is gradually ramping up production following the dam disaster, generating about US$800 million in Ebitda and US$500 million in free cash flow last year from 9 million metric tons of output. Production is expected to increase to about 16 million tons in fiscal 2026 and about 27 million tons in fiscal 2029, McTaggart says. BHP rises 1.2% to A$42.88. (rhiannon.hoyle@wsj.com; @RhiannonHoyle)

(END) Dow Jones Newswires

October 27, 2024 22:29 ET (02:29 GMT)

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The JV is gradually ramping up production following the dam disaster, generating about US$800 million in Ebitda and US$500 million in free cash flow last year from 9 million metric tons of output. Production is expected to increase to about 16 million tons in fiscal 2026 and about 27 million tons in fiscal 2029, McTaggart says. BHP rises 1.2% to A$42.88. 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