Last week, the world's largest listed diversified miner, BHP Billiton announced that it will take a $4.9 billion post-tax, $7.2 billion pre-tax, exceptional impairment against its US onshore hydrocarbon assets. After this write-down, the value of these assets will fall to $12 billion after a deferred tax liability, down from $21 billion pre-tax in June.
In addition to the impairment, BHP has cut the number of US onshore rigs it is operating from 7 to 5 (down from 10 mid-2015). The impact of the lower rig count will reduce the group's onshore US production to 110MMboe for 2016 (down 3MMboe) and 98MMboe for 2017.
Citigroup estimates that these moves will save the company around $100 million in capex during 2016. US onshore capex is...
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