BP begins world drive to increase global oil production

4 March 2010 4 March 2010

BonTrade

BP will begin 42 new global oil production projects over the next five years as oil fields decline, the company said this week.

The schemes, which are spread from Russia to the North Sea, will contribute one million barrels of oil a day by 2015, which amounts to a quarter of BP’s total oil production.

BP, which will spend £10 billion on exploration and production this year, expects production to rise by between 1% and 2% a year to 2015 and is confident of further growth to 2020. Deep-water sources, giant oilfields and gas, including unconventional gas sources, will drive medium-term growth, the company said.

Chief executive Tony Hayward has embarked on a recovery programme for BP and has shed around 8,000 staff, and his latest efficiency drive will focus on working existing assets harder rather than cutting jobs.

Hayward said: ‘The challenge and the opportunity for us is that while our portfolio ranks among the best in the industry, our financial performance has yet fully to reflect this.’

The real juice is the $2 billion in efficiency gains BP has identified at its refineries. After a series of accidents, it has taken BP five years to get them back in full working order. In that time, efficiency has been neglected, with a 30%-plus gap between its best- and worst-performing facilities. A number of smaller refineries have been earmarked for disposal.