BHP Billiton Ltd. (NYSE: BHP) said April 19 its decision last year to exit its underperforming U.S. shale oil and gas business was going as planned.
BHP reiterated it expected bids by June and added that transactions could be announced in the first half of the 2019 financial year.
Sky News last month reported Royal Dutch Shell Plc (NYSE: RDS.A) and U.S. private-equity firm Blackstone Group LP were working on a joint $10 billion bid for BHP's U.S. shale assets.
RELATED: BHP’s US Shale Exit Opens Prized Delaware Assets To All Comers
BHP also cut its 2018 fiscal year iron ore output guidance on April 19 citing issues in its railroad car unloading system, while also slightly raising its copper output expectations given higher production at the Escondida mine.
Overall, the outcome of the global miner's third quarter production was balanced as lower iron ore output and eased guidance should be broadly offset by a slight pick up in third quarter copper production and upgraded guidance, said Sydney-based brokerage Shaw and Partners in a report.
Given a boom in commodity prices, BHP is also looking at a significant uplift to earnings, the broker noted.
"The latest mark to market for BHP using spot forex and commodity prices—points to 20%-30% earnings uplift," it said.
BHP shares rallied 3.1% on the Australian stock exchange on April 19, in line with a broad rally across the mining sector after Russia sanctions disrupted the global aluminum supply chain and lit a fire under producers, particularly those making nickel, aluminum, alumina.
"The 2018 March quarterly result was softer than our estimates across the board, with the exception of the copper group, where Escondida performed solidly and improved utilization rates at Pampa Norte offset a slower than expected ramp-up at Escondida," said RBC analyst Paul Hissey in a report.
"We view BHP as fair value, and view the stock as on par with RIO," he said.
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