BP PLC — Earnings Release 2004

Jan 12, 2005

News Details

Ad-hoc | 12 January 2005 09:19

BP p.l.c.: BP PLC announces Trading Statement Part 1 of 2

Ad hoc announcement §15 WpHG – Part 1 Trading Statement BP p.l.c.: BP PLC announces Trading Statement Part 1 of 2 Ad hoc announcement processed and transmitted by DGAP. The issuer is solely responsible for the content of this announcement. —————————————————————————— Part 1 of 2 BP Press Release January 12, 2005 BP Fourth Quarter 2004 Trading Update This trading update is aimed at providing certain estimates regarding revenue and trading conditions experienced by BP in the fourth quarter ending December 31, 2004, and estimates of certain identified non-operating items expected to be included in that quarter’s result. The fourth quarter margin, price, realisation, cost, production and other data referred to below are currently provisional, some being drawn from figures applicable to the first month or so of the quarter. All such data are subject to change and may differ quite considerably from the final numbers that will be reported on February 8, 2005. The statement is produced in order to provide greater disclosure to investors and potential investors of currently expected outcomes, and to ensure that they all receive equal access to the same information at the same time. Resources Business : Exploration and Production Marker Prices 4Q’03 2Q’04 3Q’04 4Q’04 Brent Dated ($/bbl) 29.43 35.32 41.54 43.85 WTI ($/bbl) 31.15 38.28 43.88 48.29 ANS USWC ($/bbl) 29.43 36.99 41.82 42.62 US gas Henry Hub first of month index ($/mmbtu) 4.58 6.00 5.75 7.07 UK gas price – National Balance Point (p/therm) 27.30 20.70 23.63 28.48 Overview : Exploration and Production Overall BP production in 4Q’04 is expected to be around 4,090 thousand barrels of oil equivalent per day (mboed), up by some 4 per cent from 3,936 mboed in 4Q’03, and over 4 per cent higher than 3Q’04 production of 3,906 mboed. Average production for 2004 as a whole is expected to be around 3,995 mboed, an increase of more than 10 per cent compared to 2003. Excluding Russia: Production in 4Q’04, excluding volumes from our Russian operations, is expected to be approximately 3,125 mboed, over 5 per cent higher than the 3Q’04 level of 2,961 mboed due to the continuing ramp-up of production in New Profit Centres (60 mboed) and the end of the turnaround season in Alaska and the North Sea (120 mboed). During the quarter we achieved first production from the Holstein field in the Deepwater Gulf of Mexico. The operational impacts on production from Hurricane Ivan in the Gulf of Mexico and the blow- out in Temsah in Egypt are expected to be around 80 mboed during the fourth quarter. Relative to 3Q’04, liquids realisations did not increase as much as the markers, reflecting discounts for heavier crudes and the timing of liftings. Relative to 3Q’04, gas realisations in North America did not increase as much as the Henry Hub marker due to regional pricing differences. Costs in 4Q’04 are expected to be around $250m more than in 3Q’04 due to higher exploration write-offs, repairs necessary as a result of Hurricane Ivan in the US and the Temsah incident in Egypt, and planned increases in seismic investment. The 4Q’04 impact of Unrealised Profit in Stock (UPIS) is expected to increase earnings by approximately $70m. Russia – BP net share Production in mboed 4Q’03 2Q’04 3Q’04 4Q’04 TNK-BP: Oil 669 814 858 882 TNK-BP: Gas 51 77 87 83 Total 720 891 945 965 Marker Prices Urals (NWE – cif) ($/bbl) 27.90 32.32 37.23 37.75 Urals (Med – cif ) ($/bbl) 27.98 32.60 37.41 38.82 Domestic Oil ($/bbl) 16.65 19.71 23.33 22.30 In 4Q’04, BP’s net share of production from TNK-BP is anticipated to be approximately 965 mboed, as shown in the table above. 2004 information includes TNK-BP’s interest in Slavneft. During 4Q’04, Urals NWE marker prices increased by $0.52/bbl with the differential to Brent widening to approx $6.10/bbl. Domestic oil prices decreased slightly relative to 3Q’04 due to seasonal factors. Increases in export duty rates became effective on August 1, 2004. The full quarter impact of this increase in duties, along with the effect of lagged duty reference prices, is expected to reduce 4Q operating profit by approximately $170m relative to 3Q’04. Customer facing Businesses Refining Indicator Margins ($/bbl) 4Q’03 2Q’04 3Q’04 4Q’04 USA – West Coast 6.09 15.41 11.28 10.36 – Gulf Coast 3.53 9.18 6.99 5.52 – Midwest 2.89 9.01 5.01 1.65 North West Europe 2.21 5.29 4.37 4.72 Singapore 2.20 2.80 5.48 8.02 Refining Global Indicator Margin* ($/bbl) 3.14 7.89 6.20 5.60 *The refining Global Indicator Margin (GIM) is a weighted average based on BP’s portfolio. Actual margins may vary because of refinery configuration, crude slate and operating practices. End of part 1 BP p.l.c. 1 St James’s Square London, SW1Y 4PD United Kingdom ISIN: GB0007980591 WKN: 850517 Listed: Amtlicher Markt in Düsseldorf (Dt. Zertifikate DE0008618737), Frankfurt (General Standard) und Hamburg; Freiverkehr in Berlin-Bremen, Düsseldorf, Frankfurt, Hamburg, Hannover, München und Stuttgart End of ad hoc announcement (c)DGAP 12.01.2005 120919 Jän 05