BP PLC
import terminal, helping to secure ongoing fuel supply Divestment and other proceeds were USD6.6 billion for the full
for Western Australia. year of 2020. BP has now completed or agreed transactions for
over half of its target of USD25 billion in proceeds by 2025.
BP continued to make progress in fuels marketing in 2020, BP expects proceeds from divestments and other disposals of
expanding its retail network by more than 1,400 to over USD4-6 billion in 2021, weighted toward the second half.
20,300 sites worldwide. This includes more than 1,900
strategic convenience sites, around 300 more than a year Gulf of Mexico oil spill payments on a post-tax basis were
earlier. USD1.6 billion in the full year of 2020. Payments for 2021 are
expected to be around USD1 billion on a post-tax basis.
The USD5-billion sale of BP's petrochemicals business to
INEOS completed on 31 December and BP received the second Gearing* at 31 December 2020 was 31.3%, in part reflecting
payment of USD3.6 billion, less USD0.1 billion of third-party the hybrid bond issue in the second quarter of 2020. See page
indebtedness. Final payments totalling USD1 billion are 25 for more information.
expected in the first half of 2021.
Through 2020, the number of BP and joint venture operated
electric vehicle charging points increased to more than
10,000 worldwide, with growth in the UK, Germany and
through the DiDi joint venture in China.
Operating metrics Year 2020 Financial metrics Year 2020
(vs. Year (vs. Year
2019) 2019)
Tier 1 and tier 2 process safety 70 Underlying RC profit (loss)* USD(5.7)bn
events (-28) (-USD15.7bn)
Reported recordable injury 0.132 Operating cash flow excluding Gulf of Mexico oil spill USD13.8bn
frequency* (-20.7%) payments (post-tax) (-USD14.4bn)
Group production 3,473mboe/d Organic capital expenditure USD12.0bn
(-8.1%) (-USD3.2bn)
Upstream production (excludes 2,375mboe/d Gulf of Mexico oil spill payments (post-tax) USD1.6bn
Rosneft segment) (-9.9%) (-USD0.8bn)
Upstream unit production costs USD6.39 Divestment proceeds*
[(a)] 6.39/boe USD5.5bn
(-6.5%) (+USD3.3bn)
BP-operated Upstream plant 94.0% Gearing 31.3%
reliability (-0.4) (+0.2)
BP-operated refining availability* 96.0% Dividend per ordinary share[(b)] 5.25 cents
(+1.1) (-50.0%)
Return on average capital employed* (3.8)%
(-12.7) (a) Reflecting lower costs and divestment impacts.
(b) Represents dividend announced in the quarter (vs. prior year quarter).
The commentary above contains forward-looking statements and should be read in conjunction with the cautionary statement on page 36.
Top of page 6
Upstream
Fourth Third Fourth
quarter quarter quarter Year Year
USD million 2020 2020 2019 2020 2019
Profit (loss) before interest and tax (572) 38 614 (21,530) 4,909
Inventory holding (gains) losses* (20) (8) - (17) 8
RC profit (loss) before interest and tax (592) 30 614 (21,547) 4,917
Net (favourable) adverse impact of non-operating items* and fair value
accounting effects* 1,289 848 2,064 16,506 6,241
Underlying RC profit (loss) before interest and tax*[(a)] 697 878 2,678 (5,041) 11,158 (a) See page 7 for a reconciliation to segment RC profit before interest and tax by region. Financial results The replacement cost loss before interest and tax for the fourth quarter and full year was USD592 million and USD21,547 million respectively, compared with a profit of USD614 million and USD4,917 million for the same periods in 2019. The fourth quarter and full year included a net non-operating charge of USD612 million and USD15,768 million respectively, compared with a net charge of USD2,723 million and USD6,947 million for the same periods in 2019. The net non-operating charge for the quarter primarily reflects a net impairment charge and a provision for restructuring costs partly offset by disposal gains. The charge for the full year is principally related to impairments associated with revisions to long-term price assumptions. Fair value accounting effects in the fourth quarter and full year had an adverse impact of USD677 million and USD738 million respectively, compared with a favourable impact of USD659 million and USD706 million in the same periods of 2019. After adjusting for non-operating items and fair value accounting effects, the underlying replacement cost result before interest and tax for the fourth quarter and full year was a profit of USD697 million and a loss of USD5,041 million respectively, compared with a profit of USD2,678 million and USD11,158 million for the same periods in 2019. The result for the fourth quarter mainly reflects lower liquids and gas realizations, lower production including the impact of divestments, and a significantly weaker gas marketing and trading contribution, partly offset by lower depreciation, depletion and amortization. The result for the full year mainly reflects lower liquids and gas realizations and the impact of writing down certain exploration intangible carrying values.
Production Production for the quarter was 2,155mboe/d, 20.1% lower than the fourth quarter of 2019. This includes the impact of divestments mainly in BPX Energy and Alaska. Underlying production* for the quarter decreased by 11.1% mainly due to impacts from reduced capital investment levels and decline, significant weather impacts from hurricanes in the higher-margin US Gulf of Mexico and maintenance activity.
For the full year, production was 2,375mboe/d, 9.9% lower than the full year of 2019 mainly due to the impact of divestments in BPX Energy and Alaska. Underlying production for the full year decreased by 3.5% mainly due to impacts from reduced capital investment levels and decline, and significant weather impacts from hurricanes in the US Gulf of Mexico. Key events On 26 October, BP announced the start of production from the Qattameya field in the North Damietta concession, located offshore Egypt (BP operator 100%).
On 29 October, BP confirmed oil discoveries at the Cappahayden and Cambriol prospects in the Flemish Pass basin, offshore Newfoundland, Canada (Equinor operator 60%, BP 40%).
On 15 November, the Trans Adriatic Pipeline (TAP), an 878-km gas transportation system crossing Greece, Albania, the Adriatic Sea and Italy, became operational (BP 20%, SOCAR 20%, Snam 20%, Fluxys 19%, Enagás 16% and Axpo 5%), with first gas exports from Azerbaijan to Europe commencing in December.
On 26 November, BP announced the start of production from the Vorlich field in the UK North Sea (BP 66%, Ithaca Energy operator 34%).
On 15 December, BP signed an agreement to sell its interest in the Wamsutter asset, located in the Greater Green River Basin, Wyoming, US, to Williams Field Services LLC. Subject to approvals, the transaction is expected to complete in first quarter 2021.
On 18 December, BP and Reliance Industries Limited (RIL) announced the start of production from the R Cluster ultra-deep-water gas field in block KG D6 off the east coast of India. (RIL operator 66.67%, BP 33.33%).
On 1 February 2021, BP announced it has agreed to sell a 20% participating interest in Oman's Block 61 to PTT Exploration and Production Public Company Limited (PTTEP). Subject to approvals, the transaction is expected to complete in 2021 and following which the participating interests in Block 61 will be: BP operator 40%, OQ 30%, PTTEP 20%, and PETRONAS 10%. Outlook We expect full-year 2021 underlying production to be slightly higher than 2020 due to the ramp-up of major projects, primarily in gas regions, partly offset by the impacts of reduced capital investment and decline in lower-margin gas assets. We expect reported production to be lower due to the impact of the ongoing divestment programme.
We expect first-quarter 2021 reported production to be slightly higher than fourth-quarter 2020.
The commentary above contains forward-looking statements and should be read in conjunction with the cautionary statement on page 36.
Top of page 7
(MORE TO FOLLOW) Dow Jones Newswires
February 02, 2021 05:18 ET (10:18 GMT)
