Australian mining giant BHP Billiton has announced that, effective June 5, 2008, force majeure has been lifted across the BHP Billiton Mitsubishi Alliance (BMA) managed operations (including BHP Billiton Mitsui (BMC)). Force majeure was put in place on January 24, 2008 following extreme weather and flooding across the central Queensland coalfields in Australia.
On February 25, 2008, BHP Billiton advised that its equity coal production loss from flooding at its BMA and BMC operations was estimated to be between 3.7-4.6 million mt. The latest assessment indicates that BHP Billiton's share of production loss is expected to be at the upper end of that range. According to a statement issued by the company, discussions are continuing with insurance assessors to progress claims arising from the events.
The extreme weather and declaration of force majeure has also resulted in delivery delays for some of the 2007 sales contracts. Sales from BMA and BMC during the 2008 financial year are expected to include approximately 2.1 million mt (BHP Billiton share) of coal priced at the higher 2008 agreed prices. Approximately 1.4 million mt (BHP Billiton share) of coal that will be delivered in the first quarter of the next financial year will be sold at 2007 prices.