BP’s full year financials for 2016 have revealed a second consecutive year of loss, partly offset by the success of the downstream business.

The downstream fuels business reported an underlying replacement cost profit before interest and tax of $417 million for the fourth quarter and $3.7 billion for the full year, compared with $888 million and $5.9 billion for the same periods in 2015.

The London head office report said results reflected a significantly weaker refining environment, with adverse impacts partly offset by increased fuels marketing performance driven by retail growth, higher refining margin capture in operations, and lower costs from simplification and efficiency programmes.

The company blamed losses on liabilities related to the Deepwater Horizon accident of 2010, however chief executive Bob Dudley said the company was getting “back to growth”.

“With our Deepwater Horizon financial liabilities now substantially behind us, BP is fully focused on the future,” he said.

“From increasing gas interests and renewing long-term low-cost oil to expanding our retail operations – these investments will generate significant long term value for our shareholders.

“We start this year with considerable momentum – and a sense of disciplined ambition. We have laid the foundations for BP to be back to growth.”

The full year report said adverse impacts were partly offset by increased fuels marketing performance driven by retail growth, higher refining margin capture in operations, and lower costs from simplification and efficiency programmes.

The reported loss in relation to Deepwater settlement payouts was $US999 million, compared with a loss of $US5.16 billion for the full year 2015.

Payments related to the spill are expected to be lower in 2017, around $US4.5 to 5.5 billion, and are predicted to fall to $US2 billion in 2018.

“We have delivered solid results in tough conditions – and are well prepared for any volatility in oil pricing,” Mr Dudley said.

“We have adapted by cutting our controllable cash costs by $US7 billion from 2014 – a full year earlier than planned.

“Continued tight discipline on costs remains essential. Everything we have done during the year has made us a more resilient and competitive company.”

The company also acknowledged the December 2016 announcement of a strategic partnership with Woolworths, which will see BP acquiring Woolworths’ fuel and convenience sites for $1.3 billion, pending regulatory approvals later in the year.

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