MELBOURNE, Feb. 23 (UPI) -- Australian mining and energy giant BHP Billiton said it retooled its corporate team and adopted a new dividend policy in response to oil market weakness.
The company said Tuesday it posted its first loss in more than 16 years and was cutting its dividend paid to shareholders by about 75 percent. Spending for exploration and production will decline across the board and, in U.S. shale basins, the company said expenditures would fall from $7 billion to $5 billion next year.
BHP Billiton Chief Executive Officer Andrew Mackenzie defended the spending and dividend policy as part of a broad-based strategy meant to steer the company through a depressed energy sector.
"Slower growth in China and the disruption of the Organization of Petroleum Exporting Countries have resulted in lower prices than expected," he said in a statement. "However, our company remains resilient with assets that generate free cash flow through the cycle and a strong balance sheet."
OPEC members have been divided over production policies amid Iran's imminent return to oil markets. Sanctions pressures are easing on Iran, an OPEC member, after it met the terms of a multilateral nuclear agreement earlier this year. Some member states agreed to freeze production at January levels, though some analysts have said that will do little to stimulate prices in a market already awash in oil.
BHP Billiton said it was prepared for the downturn, but stressed, from its perspective, the weakness is expected to last.
Among other shakeups, the company said its Petroleum President Tim Cutt has now left the company in what it described as a streamlining effort designed to "accelerate productivity and value creation."