Australian mining giant BHP Billiton has posted a huge net loss of US$5.67 Billion for the six months ending in December.  It's the first loss in more than 16 years for the world's biggest diversified miner, and the company warned that weak commodity prices will continue.

This forced BHP to ditch its progressive dividend policy, which held that it would pay a steady or higher dividend at each half-year result to protect its solid 'A' credit rating - the highest in the decimated mining sector.  BHP reduced the payout from 62 cents a share to just 16 cents.

"Slower growth in China and the disruption of OPEC have resulted in lower prices than expected," BHP Chief Executive Andrew Mackenzie said.  "Our new dividend policy and transparent capital allocation framework are part of a broader strategy to help BHP Billiton manage volatility," he added.

Chairman Jacques Nasser said the decision to cut dividends was not made lightly, but was a "determined response to changing markets".

BHP also faces continuing problems over last November's disaster at its Samarco joint venture with Vale in Brazil - a dam burst in Minas Gerais state, which killed at least 17 people and inundated a large area with red mud which local officials insist is toxic mine waste.  A judge in Brazil blocked more than AU$175.5 Million of Samarco's assets to guarantee the clean up and repair of the disaster area - schools, water and sewage networks, football pitches, and public buildings included.  BHP already took an after tax charge of US$858 million relating to the disaster.