Andrew MacKenzie.

"When we get that number ($25 billion), we will have a serious and practical conversation on how we might increase cash returns to shareholders,": BHP chief executive Andrew MacKenzie. Photo: Julian Andrews

BHP Billiton is planning a multi-billion dollar return of cash to investors within months as Chinese demand for resources fuels to miner's increase in output.

BHP chief executive Andrew Mackenzie has reaffirmed the company's $US5.5 billion ($6.1 billion) cost-cutting target by the end of this year and a reduction in debt to $US25 billion, in an interview with London's The Sunday Times.

''When we get that number ($25 billion), we will have a serious and practical conversation on how we might increase cash returns to shareholders," Mr Mackenzie said.

When he took over from former chief executive Marius Kloppers, who had been part of the great mining boom expansion, Mr Mackenzie began huge cost-cutting measures and the selling off of assets as mining capital expenditure peaked.

Analysts have previously said BHP cutting gearing levels to below 30 per cent would trigger shareholder buybacks or investments in further growth.

''Management believe they can achieve an average internal rate of return of over 20 per cent for the major project options. We see further project approvals with the 2014 full year results,'' said Deutsche Bank analyst Paul Young.

Mr Young suggested the Spence copper project in Chile or the Pilbara iron ore business were the most likely candidates for investment funding.