|
|
BHPBill - operational review
BHPBill released their operational review for the half year ended 31 December 2015.
- Further productivity improvements supported the robust production performance across our operated assets during the period.
- Full year production guidance maintained for Petroleum, Copper and Coal.
- Guidance at Western Australia Iron Ore (WAIO) maintained at 270 Mt (100% basis) as continued productivity is expected to offset one-off operational issues from the December quarter. Total iron ore guidance reduced by 10 Mt to 237 Mt due to the suspension of production at Samarco.
- Four major projects under development are tracking to plan. The North West Shelf Greater Western Flank-A petroleum project was completed under budget and ahead of schedule. The Greater Western Flank-B project was approved during the period.
- Underlying attributable profit(1) in the December 2015 half year is expected to include additional charges in a range of approximately USD300 million to USD450 million (detail presented on page 2).
Further information on BHPBill can be found at: bhpbilliton.com
|
|
Click here for original article
|
| |
BHPBill - onshore US Asset Review
BHPBill expects to recognise an impairment charge of approximately USD4.9 billion post-tax (or approximately USD7.2 billion pre-tax) against the carrying value of its Onshore US assets. This charge will be recognised as an exceptional item in the financial results for the half year ended 31 December 2015.
The impairment follows the bi-annual review of the Company’s asset values and reflects changes to price assumptions, discount rates and development plans which have more than offset substantial productivity improvements. The impairment will reduce Onshore US net operating assets to approximately USD16 billion. The oil and gas industry has recently experienced significant volatility and much weaker prices.
The US gas price remains low as industry-wide productivity improvements have resulted in higher than expected supply at lower cost. BHPBill has previously suspended development of its dry gas acreage. The Company has now also reduced its medium and long-term gas price assumptions. In addition, the oil price has fallen by more than 30 per cent over the last three months following the disruption of OPEC and stronger than anticipated non-OPEC production. Although we expect prices to improve from their current lows, we have reduced our oil price assumptions for the short to medium term. Our long-term price assumptions continue to reflect the market’s attractive supply and demand fundamentals.
The increased volatility in prices has also increased the discount rates applied by BHPBill, which has a significant flow through impact on the Company’s assessment of its Onshore US asset value. The Group will reduce the number of operated rigs in its Onshore US business from seven to five in the March 2016 quarter. This will comprise three rigs in the Black Hawk and two rigs in the Permian. Beyond this, investment and development plans for the remainder of the 2016 financial year are under review, with a focus on preserving cash flow. The broader carrying value assessment of the Group’s assets will be finalised in conjunction with the interim financial results to be released on 23 February 2016.
|
|
Click here for original article
|
| |
| |
|
| Closing price data source: JSE Ltd. All other statistics calculated by ProfileData. |
| |
|
|
