BP PLC has reported market beating headline profit as it benefited from lower realizations, portfolio changes, lower refining margins and lower oil trading, and announced a $1.75 billion share buyback program. Here is what the oil major had to say:
“Reported production for the quarter was 899,000 barrels of oil equivalent a day [boe/d] 6.0% lower than the same period in 2022. Underlying production was 3.8% lower, mainly due to base decline, particularly in Egypt, partly offset by major project delivery.”
“Reported production for the full year was 929,00 boe/d, 2.9% lower than the same period in 2022. Underlying production was 2.3% lower, mainly due to base decline, partly offset by major project delivery.”
“Renewables pipeline at the end of the quarter was 58.3GW (BP net), including 19.3GW BP net share of Lightsource BP’s (LSBP’s) pipeline.”
“The renewables pipeline increased by 21.1GW net during the full year, including BP being awarded the rights to develop two North Sea offshore wind projects in Germany (4GW), increases to LSBP’s pipeline (5.3GW), and an increase in dedicated hydrogen renewables (12.4GW). In addition, there is over 12GW (BP net) of early stage opportunities in LSBP’s hopper.”
On gas & low carbon energy:
“Reported production for the quarter was 899,000 boe/d, 6.0% lower than the same period in 2022. Underlying production was 3.8% lower, mainly due to base decline, particularly in Egypt, partly offset by major project delivery.”
“Reported production for the full year was 929,000 boe/d, 2.9% lower than the same period in 2022. Underlying production was 2.3% lower, mainly due to base decline, partly offset by major project delivery.”
On oil production & operations:
“Reported production for the quarter was 1.42 million boe/d, 8.6% higher than the fourth quarter of 2022. Underlying production for the quarter was 8.5% higher compared with the fourth quarter of 2022 reflecting BPx energy performance and major projects.”
“Reported production for the full year was 1.38 million boe/d, 6.7% higher than the same period of 2022. Underlying production for the full year was 6.3% higher compared with the same period of 2022 reflecting BPx energy performance and major projects and base performance.”
On 1Q 2024 guidance:
“Looking ahead, BP expects first quarter 2024 reported upstream production to be higher compared to fourth-quarter 2023.”
“In its customers business, BP expects seasonally lower volumes across most businesses and the absence of one-off positive effects from the fourth quarter. In addition, BP expects fuels margins to remain sensitive to movements in cost of supply.”
“In products, BP expects a significantly lower level of refinery turnaround activity compared to the fourth quarter. In addition, BP expects lower industry refining margins, with a larger reduction in realized margins due to narrower North American heavy crude oil differentials.”
On 2024 guidance:
“BP expects both reported and underlying upstream production to be slightly higher compared with 2023. Within this, BP expects underlying production from oil production & operations to be higher and production from gas & low carbon energy to be lower.”
“In its customers business, BP expects continued growth from convenience, including a full year contribution from TravelCenters of America; a stronger contribution from Castrol underpinned by volume growth in focus markets; and continued margin growth from BP pulse driven by higher energy sold. In addition, BP expects fuels margins to remain sensitive to the cost of supply.”
“In products, BP expects a lower level of industry refining margins, with realized margins impacted by narrower North American heavy crude oil differentials. BP expects refinery turnaround activity to have a similar impact on both throughput and financial performance compared to 2023, with phasing of activity in 2024 heavily weighted towards the second half.”
“BP expects the other businesses & corporate underlying annual charge to be around $1.0 billion for 2024. The charge may vary from quarter to quarter.”
“BP expects the depreciation, depletion and amortization to be slightly higher than 2023.”
“BP expects the underlying ETR for 2024 to be around 40% but it is sensitive to the impact that volatility in the current price environment may have on the geographical mix of the group’s profits and losses.”
“BP expects capital expenditure of around $16 billion, weighted to the first half.”
“BP expects divestment and other proceeds of $2-3 billion in 2024, weighted towards the second half. Having realized $17.8 billion of divestment and other proceeds since the second quarter of 2020, BP continues to expect to reach $25 billion of divestment and other proceeds between the second half of 2020 and 2025.”
“BP expects Gulf of Mexico oil spill payments for the year to be around $1.2 billion pre-tax including $1.1 billion pre-tax to be paid during the second quarter.”
Shares at 0913 GMT were up 27.60 pence, or 6.1%, at 481.75 pence, and are leading the FTSE 100 index risers. They are currently up 0.7% over the past 12 months.
Write to Ian Walker at [email protected]
Read the full article here
