The major portion of the charge is related to the gas-focused Hawkville field, and the reminder is an outcome of Petrohawk acquisition.

BHP bought oil and gas company Petrohawk for around $12bn in 2011.

Impairment for the Hawkville field reflects its geological complexity, product mix, acreage relinquishments and amended development plans.

The impairment charges are expected to be offset in the balance sheet through cost reductions, and improved well performances.

Increased potential of the Permian field from the previously estimated 100kboe/d to 150kboe/d will support in balancing the charges, the company said.

Following the impairment, Onshore US business will have net operating assets of approximately $24bn.

BHP Billiton Petroleum president Tim Cutt said: "While the impairment of the Hawkville is disappointing, it does not reflect the quality of our broader Onshore US business.

"The Black Hawk continues to exceed expectations, the Permian offers significant upside across multiple zones and the Haynesville, one of the industry’s premier dry gas positions, provides an excellent development option as market conditions improve.

The company will support the development of ten operating rigs with an investment of $1.5bn in Onshore US in the 2016 financial year.