BP pursues new projects despite $1.4bn loss in second quarter
27 Jul 2016 - 0:00
LONDON: BP will forge ahead with at least three more new projects this year, its CEO said, despite the British oil major reporting a 45 percent drop in second-quarter earnings that prompted a cut in its 2016 investment budget to below $17bn.
Though BP Chief Executive Bob Dudley (pictured) acknowledged that the global oil glut’s impact on refining margins and revenue continues to make for a challenging environment, he said that capital expenditure plans have been helped by a drop in associated costs. “We’re going to choose our projects really carefully and the cost reductions and re-engineering of the projects has really brought them down to what I think is a very attractive (price range),” Dudley told Reuters.
Dudley said that BP could make another three final investment decisions this year, having already signed off on the expansion of its Tangguh LNG plant in Indonesia and the Atoll offshore gas project in Egypt.
The company posted a loss after taxation of $1.4bn for the three months to June, which however compared with a far larger loss of $5.8bn for the second quarter of 2015.
BP also booked a net post-tax non-operating charge of $2.8bn for costs linked to the oil disaster. That included a pre-tax non-operating charge of $5.2bn.
The energy major had already revealed earlier this month that the final cost for the 2010 Gulf of Mexico oil spill stood at $61.6bn, including the latest second-quarter hit.
“We are very pleased to have finally drawn a line under the material liabilities for Deepwater Horizon,” said Dudley in the results statement. “We will always be mindful of what we have learned from that tragic accident. BP today is a stronger, more focused and more disciplined company We continue to actively develop a strong, balanced portfolio and we are managing the business for value over volume. Our relentless group-wide focus on capital and cost discipline is helping BP to become much more efficient while maintaining the investment needed for future growth.”
Back in 2010, an explosion on the Deepwater Horizon oil rig killed 11 men off the coast of Louisiana and caused 507 million litres of oil to spew into Gulf waters.