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BP reports record second quarter performance
BP said the company’s pro forma result, adjusted for special items, for the second quarter was $3,610 million compared to $1,367 million a year ago, an increase of 164 percent. For the half year the result was up by 197 percent.
For the half year the combined cost structure of BP and ARCO was $1 billion lower than a year ago, excluding the impact of divesting ARCO’s Alaska and Cushing assets. This represents the achievement of half the target of a $2 billion cost reduction year-on-year.
Total hydrocarbon production increased by 5 percent and 1 percent for the quarter and half year respectively.
The company said the proforma exploration and production result, after adjusting for special items, for the second quarter was a record $3,627 million. The special items comprised ARCO integration costs. The quarter’s result included $80 million from two weeks of ARCO Alaska operations, prior to the sale to Phillips Petroleum. The adjusted result was up 143 percent compared with a year ago reflecting significantly higher oil and gas prices and cost savings. Hydrocarbon production was up, with increased gas production more than offsetting lower liquids production, resulting from divestments and the Alaska alignment. Upstream production investment is significantly higher, building on recent exploration success. Alaska alignment allows for optimizing The alignment of Alaska interests, finalized in April, allowed the company to optimize operations, BP said, and in return for a reduction in its share of liquids production, it achieved a significantly strengthened gas position and immediate cost savings through its single operatorship.
Divestment of non-core properties continued and at the end of May, the company entered into an agreement with Vastar Resources Inc. enabling BP to acquire the publicly held minority stock holding, enabling substantial cost synergies through combining Vastar operations with those of BP.
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