The ratings agency said the risk of default would rise as credit profiles continued to weaken.

"We expect Australian mining companies to cut investments and operating costs further in the next 12 months,” Moody’s analyst Saranga Ranasinghe said.

“The fall in forecast investment comes on top of considerable spending reductions miners have already made to preserve margins and liquidity.

“Contract renegotiations and in-housing of projects by miners will further pressure the profitability of mining services companies.”

In the past 18 months, Moody’s has taken negative ratings actions on all five of its rated mining services companies – Ausdrill, Barminco, Onsite Rental Group, Emeco Holdings and Bis Industries.

All five have negative outlooks due to expected falls in earnings and cashflow for miners, which leads on to slimmer demand for services.

Moody’s said Emeco and Bis had the highest risk of default due to high leverage, while the other three had adequate liquidity buffers.