BHP Writes Down Billions

Company Plans to Keep Three Rigs in Eagle Ford
BHP Writes Down Assets

BHP Writes Down Assets

BHP Billiton Ltd., a major operator in the Eagle Ford, announced immediate plans to write down US$7.2 billion pretax charges on its U.S. shale value.

Related: Eagle Ford Headed for Big Losses

In a recent news release, BHP set in motion the latest in a string of impairment charges for the company, which will reduce its onshore U.S. net operating assets to approximately US$16 billion.

BPH is also reviewing it 2016 CAPEX for additional places to cut costs.

Although the company plans to pull back rigs, they will keep three rigs in the Black Hawk field in southern Texas’ Eagle Ford region. Related: Read more about BHP in the Eagle Ford

BHP Billiton Chief Executive Officer, Andrew Mackenzie, said “Oil and gas markets have been significantly weaker than the industry expected. We responded quickly by dramatically cutting our operating and capital costs, and reducing the number of operated rigs in the Onshore US business from 26 a year ago to five by the end of the current quarter. While we have made significant progress, the dramatic fall in prices has led to the disappointing write down announced today. However, we remain confident in the long-term outlook and the quality of our acreage. We are well positioned to respond to a recovery.”

The U.S. Energy Information Administration (EIA) recently announced that the volumes from the seven major shale regions in the U.S. will drop by 116,000 barrels a day in February. The Eagle Ford Shale Play is predicted to take the biggest hit of all the shale plays and is expected to drop 72,000 barrels a day to 1.15 million, according to the EIA. The Bakken in North Dakota losing 24,000 barrels to 1.1 million.

Read more at bhpbilliton.com

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Elizabeth Alford

Elizabeth Alford

Elizabeth Alford writes on significant news developments in the Eagle Ford oil and gas play taking place across South TX. She is a freelance writer with an extensive communications, PR, and staff writing background.
Elizabeth Alford

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