News from AAP

BHP’s Petrohawk posts big first-half loss after writedown

Print This Post A A A

BHP Billiton’s recent shale gas acquisition Petrohawk Energy has posted a steep first-half loss, a week after the global mining giant wrote down the value of its American assets.

BHP on Thursday said Petrohawk reported a first-half net loss of $US101.8 million ($A96.66 million), compared to a profit of $US42.9 million ($A40.73 million) in the previous corresponding first half.

The Petrohawk loss came despite a jump in oil and gas operating revenue of $US965.3 million ($A916.58 million), up from $US793.9 million ($A753.83 million) in the same half a year earlier.

Operating expenses were $US919 million ($A872.62 million) in the first half, up from $US875 million ($A830.84 million).

In 2011 the company spent almost $US20 billion ($A19.42 billion) on two major acquisitions in the booming US shale gas market, buying Petrohawk Energy and Chesapeake Energy Corp’s interest in the Fayetteville shale field in Arkansas.

But investors are continuing to question the wisdom of BHP Billiton’s bet on unconventional gas following last week’s write down of its American shale gas assets by $US2.84 billion ($A2.73 billion).

A rush into natural gas as a cleaner energy source by global companies has created a glut of supply in the United States, causing prices to plunge.

BHP, the world’s biggest resources company, recently defended its $US20 billion ($A19.21 billion) shale acquisitions and said they will eventually generate strong returns.