MELBOURNE May 29 BHP Billiton, the
world's biggest coking coal exporter, said it expects the market
to be "comfortably supplied" in the near term, with supply
swings determined by U.S. mines and demand swings dominated by
"In the absence of a major supply disruption, near-term
metallurgical coal prices will be range bound," the company said
in slides prepared for the first analyst briefing by newly
appointed coal chief Dean Dalla Valle and his team.
Dalla Valle is pulling together BHP's two coal businesses,
combining energy coal, used in power plants, and coking coal,
used in steel-making, and looking to strip out costs in the face
of a steep decline in coal prices, higher royalties and a high
He said BHP Billiton would look to sell some coal assets as
part of the company's wider effort to focus only on its best
mines, and would not embark on any new coal projects.
"Our plan will deliver substantial growth in free cash
flow," the slides said.
The market is expected to remain well supplied as projects,
such as BHP's Caval Ridge mine in Australia's Queensland state,
are completed and as production that was held back due to
weather or industrial disruptions returns, BHP said.
BHP said China will dominate demand in the near-term, but
India and emerging countries would become increasingly important
drivers further out as Chinese demand growth eases.
"China is expected to remain a significant importer, however
much of China's future demand growth will be met by domestic
coals," it said.