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BRIEF-BHP Billiton expects impairment charge of about $4.9 bln post-tax against carrying value of onshore US assets

Published 15/01/2016, 09:27 am
BRIEF-BHP Billiton expects impairment charge of about $4.9 bln post-tax against carrying value of onshore US assets
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Jan 15 (Reuters) - BHP Billiton (L:BLT) Ltd BHP.AX :

* Onshore US asset review BHP.AX

* Expects to recognise an impairment charge of approximately US$4.9 billion post-tax (or approximately US$7.2 billion pre-tax) against the carrying value of its onshore US assets

* Says charge will be recognised as an exceptional item in the financial results for the half year ended 31 December 2015.

* The company has now also reduced its medium and long-term gas price assumptions"

* US gas price remains low as industry-wide productivity improvements have resulted in higher than expected supply at lower cost

* The oil and gas industry has recently experienced significant volatility and much weaker prices."

* Says the increased volatility in prices has also increased the discount rates applied by BHP Billiton

* Says group will reduce the number of operated rigs in its onshore US business from seven to five in the March 2016 quarter

* Group will reduce the number of operated rigs in its onshore US business from seven to five in the March 2016 quarter"

* Dramatic fall in prices has led to the disappointing write down announced today"

* We are well positioned to respond to a recovery"

* Says "we remain confident in the long-term outlook and the quality of our acreage"

* Impairment will reduce onshore US net operating assets to approximately US$16 billion"

* Investment and development plans for the remainder of the 2016 financial year are under review"

* Although we expect prices to improve from their current lows, we have reduced our oil price assumptions for the short to medium term"

* Source text for Eikon ID:nASX4Fwm33

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