Global miner BHP Billiton is expected to go harder than rival Rio Tinto in slashing shareholder returns when it reports its financial results this month.
Rio Tinto announced it will scrap its generous progressive dividend policy next year after reporting an annual loss of $US866 million ($A1.22 billion) on Thursday, as a collapse in commodity prices weighed down earnings.
But analysts believe BHP, the world's largest miner, will go a step further by cutting its interim dividend and ending its progressive dividend policy because of the state of its balance sheet.
UBS resources analyst Glyn Lawcock said the market had been saying for many years that it did not make sense for companies to have fixed progressive dividends.
"People are liking the fact that Rio has taken the initiative and moved early rather than letting it creep up on them and find themselves forced into it," Mr Lawcock told AAP.
Rio will pay dividends of $US2.15 per share for 2015, but it intends for 2016 full year dividends to fall to no less than $US1.10.
Meanwhile, UBS predicts BHP will halve its 2015 interim dividend to 31 cents from 62 cents, saving the company $US1.65 billion.
"The oil price, sub $US30, causes a lot more pain for BHP than it does for pure play miners," Mr Lawcock said.
He said Rio's decision to end its progressive dividend policy had taken the market by surprise.
Rio's shares were heavily sold off in London overnight, but the company's share prices held relatively firm in local trade on Friday.
Rio also announced capital expenditure will be reduced by a further $US3 billion than already planned over the next two years and indicated that it will maintain production at 335 million tonnes.
Cost cutting drives at BHP and Rio were now entering a fourth year and current savings could be achieved through putting pressure on suppliers and productivity gains such as roster changes, Mr Lawcock said.
However, he said measures such as salary cuts would only be considered if a company began to lose money or looked to close operations.
"That's not where BHP and Rio is. They're still focused on productivity," he said.
Meanwhile, Reserve Bank governor Glenn Stevens said it was in shareholders' interests that mining companies adjust their dividends to suit the circumstances.
"Their concern is to make sure that they continue to have a strong balance sheet in difficult times and that's very much in the interests of the shareholders even if it means the dividend will be lower for a while," Mr Stevens told the House of Representatives economics committee on Friday.
"I think that's probably what's going on."
BHP will report its first half financial results on February 23.
On Friday, Rio shares were 52 cents lower at $40.47 and BHP shares were 15 cents lower at $15.09.
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