BHP Says 2012 Oil Output To Be Hampered By Permit Process

BHP Billiton BHP, Australia's largest oil and natural gas producer, said it expects 2012 output of those fuels to decline because federal regulators have been slow to approve permits for new drilling projects in the Gulf of Mexico. The Anglo-Australian mining giant is one of the largest operators in the Gulf. The company said its output dropped fractionally to 116.1 million barrels of oil equivalent for the nine months ending in March. The company expects to spend less than $600 million on oil and gas exploration in the 12 months through the end of June because of the Gulf disruption, according to Bloomberg News. In March, BHP won the second permit for a deepwater project in the Gulf following the end of the moratorium on deepwater drilling. The permit allows BHP to resume work at the Shenzi field. Even after being awarded that permit, BHP said the government's slow approval process was having a negative impact on its production. In other news, BHP, the world's largest mining company, said its third-quarter coal output slumped 18% due to storms that ravaged Australia earlier this year. Output of metallurgical coal, the grade of coal that is in high demand by Asian steel producers, fell 6.7 million tons during the quarter from 8.2 million tons a year earlier. BHP's iron ore production rose 7%. The company is the third-largest producer of that material in the world.