BP plc · LSE:BP.
BP — ESG Presentation (November 2015)
49 slides from BP's sustainability presentation, Nov 13, 2015
Slide 1: SRI annual meeting
SRI annual meeting 13 November 2015
Slide 2: Cautionary statement
Cautionary statement Forward-looking statements - cautionary statement The presentations and the associated slides and discussion contain certain forecasts, projections and forward-looking statements – that is, statements related to future, not past events – with respect to the financial condition,
Slide 3: Carl-Henric Svanberg, Chairman: Board context
Carl-Henric Svanberg Chairman Board context
Slide 4: Dev Sanyal: Industry context and our priorities
Dev Sanyal Executive vice president, strategy and regions Industry context and our priorities
Slide 5: Agenda
Agenda • Context for the sector and BP • Managing operational risk • Shareholder resolution 25 - our response • Operating performance 5
Slide 6: Current context
Current context Brent(1) Henry Hub(1) Refining Marker Margin(2) 120 8 35 7 30 100 6 25 $/mmbtu 80 5 $/bbl $/bbl 20 4 60 15 3 40 10 2 20 1 5 2013 2014 2015 2013 2014 2015 2013 2014 2015 (1) Source: Thomson Reuters Datastream (2) Refining Marker Margin based on BP’s portfolio 6
Slide 7: The longer term view
The longer term view $/bbl Money of the day 7
Slide 8: GDP and energy demand growth
GDP and energy demand growth GDP Energy consumption by region Shares of primary energy Trillion, $2011 PPP Billion toe 240 18 50% Thousands Oil 15 40% Other 180 Other 12 Coal 30% 120 9 Non- Non-OECD OECD Asia Gas 20% Asia 6 60 10% 3 Hydro OECD OECD Nuclear Renewables* 0 0 0% 1965 2000 2035 1965 2000
Slide 9: Our strategic principles
Our strategic principles • Safe and efficient • Resilience, focused on • A focused technology operations value over volume programme • Capital and cost • Competitive growth • Relationships of discipline mutual advantage 9
Slide 10: Our proposition
Our proposition 1. Capex of $17-19bn per annum over 2015-17 2. Cash costs reduced by over $6bn by 2017 versus 2014 3. Balance organic sources and uses of cash(1) at ~$60/bbl by 2017; organic free cash flow growth thereafter 4. Divestments of $9-10bn 2014-15; $3-5bn 2016; $2-3bn 2017+ 5. Gearing mana
Slide 11: GDP, energy and emissions
GDP, energy and emissions GDP, energy and emissions Emissions growth 2013 to 2035 Index: 1990 = 100 Billion tonnes CO2 500 35 30 400 GDP 25 Energy intensity 20 300 15 Energy 10 Fuel mix 200 CO2 5 100 0 1990 2005 2020 2035 GDP growth Projected effect growth Source: BP Energy Outlook 2035 11
Slide 12: Partnership
Partnership 12
Slide 13: Bob Fryar: Managing operational risk
Bob Fryar Executive vice president, safety and operational risk Managing operational risk
Slide 14: A safer, stronger BP
A safer, stronger BP BP’s agenda is a multi-year programme with activities risk-prioritized and paced to achieve enduring and sustainable change. Three principles underpin our efforts: Our operating We test our conduct of To promote deep management system operating through self capability and a safe
Slide 15: Risk mitigation
Risk mitigation 1 Material protection Possible Possible causes Prevention barriers Mitigation barriers consequences Maintainmechanical Maintain mechanical 2 Operating outside an integrity integrity operating envelope Fire or explosion 3 Corrosion prevention Corrosion 1 2 3 Hydrocarbons Toxic release
Slide 16: Risk mitigation
Risk mitigation Prevention barriers 2 Maintain mechanical integrity Visual inspection walk-downs 1 2 3 Inspection pipeline pigging Maintenance pipeline pigging Subsea ROV inspection Advanced non intrusive inspection Internal vessel inspection External hull inspection (FPSO) Cathodic protection surve
Slide 17: Safety and environmental performance
Safety and environmental performance Number of Tier 1 & Tier 2 process safety events (T1 &T2 PSE) Number of losses of primary containment (LOPC) Number of oil spills ≥ 1 Barrel Recordable injury frequency (RIF) 17
Slide 18: In summary
In summary • Year on year performance • Underpinned by our three principles • 25 Bly recommendations complete • Safety is good business 18
Slide 19: Qs and As
SRI annual meeting 13 November 2015 Qs and As
Slide 20: SRI annual meeting
SRI annual meeting 13 November 2015
Slide 21: Dev Sanyal: Shareholder resolution
Dev Sanyal Executive vice president, strategy and regions Shareholder resolution 21
Slide 22: Shareholder resolution 25 – our response
Shareholder resolution 25 – our response • The energy transition • Resolution response − Emissions − Portfolio resilience − Public policy − Technology and low carbon R&D 22
Slide 23: The energy transition – our point of view
The energy transition – our point of view Access to Pragmatic action affordable and Potential CO2 emissions from known fossil fuel reserves (Gigatonnes) needed secure energy 400 Multiple actors, Coal economy v multiple actions gas economy 700 1,700 Production v IOCs and NOCs demand Gas Oil Coal BP S
Slide 24: BP's response
Dominic Emery VP long term planning and policy David Eyton Group head of technology BP’s response 24
Slide 25: Emissions – reporting
Emissions – reporting Direct GHG emissions by segment 70 Direct CO2e by segment 60 50 • Upstream Mte CO2e 40 OB&C • Downstream 30 Upstream 20 Downstream • Other business and corporate (OB&C), 10 including shipping and alternative 0 2010 2011 2012 2013 2014 energies Direct GHG emissions by source 70
Slide 26: Emissions – operations
Emissions – operations Upstream Methane emissions by segment • Methane detection 0.3 • Flaring intensity 0.2 • Real sustainable reductions • External initiatives 0.2 Mte CH4 OB&C Refining Downstream 0.1 Upstream • Energy intensity • Product formulations 0.1 Petrochemicals 0.0 • Energy consumption an
Slide 27: Emissions – products
Emissions – products Lubricants • 5.2 million tonnes of CO2 avoided using in the last ten years Advanced fuels • New Ultimate fuels range launched in Spain this year • Up to 56km / tank better for diesel • Up to 44km / tank better for gasoline 27
Slide 28: Portfolio resilience
Portfolio resilience Resilient to the environment Contribution to 2020 pre-tax operating cash flow(2) • Integrated business model Upstream • ~80% of pre-FID(1) major projects break-even below Pre-FID(2) $60/bbl Brent oil price Post-FID(2) major Gas value chains Other projects • Carbon price applied
Slide 29: Portfolio resilience – growth of gas
Portfolio resilience – growth of gas • Gas has half the CO2 emissions of coal when combusted for power generation 2014 • 50% of our current production is gas, and is forecast to grow 60% by the mid 2020s Oil Gas • Two mega-projects in construction − Shah Deniz 2 − Oman Khazzan Mid 2020s 29
Slide 30: Portfolio resilience – major gas projects
Portfolio resilience – major gas projects Oman Khazzan • 100TCF, giant resource base • 7TCF first phase of development • 2017 first gas for growing domestic market • ~300 wells • Designed to minimise methane leakage Shah Deniz 2 • 40TCF, giant resource base • Pipelines to Europe through 7 countries
Slide 31: Portfolio resilience – renewables businesses
Portfolio resilience – renewables businesses • The largest operated renewable business of supermajors • ~3 million tonnes avoided CO2 in 2014 Brazilian biofuels: 3 mills, 643 million litres production • Growing domestic ethanol market • Cost-advantaged and robust at $45 – 50/bbl US wind: 16 farms, 4
Slide 32: Portfolio resilience – asset classes
Portfolio resilience – asset classes Technology 2012 2050 • Grows recoverable volumes Cost per barrel of oil equivalent ($/boe) • Reduces cost of supply • Changes rank Carbon price • Increases cost of supply • Price impact varies by asset class • Changes rank Technically recoverable volume (boe) Ons
Slide 33: Public policy – approach
Public policy – approach Partnerships Pillars • Carbon price • Efficiency of operations and products • The role of gas • The role of technology and research • Partnerships and initiatives Products • Energy Outlook • Technology Outlook OGCI declaration and report – www.oilandgasclimateinitiative.com
Slide 34: Technology – approach
Technology – approach • R&D spend of $663m in % Reported R&D/ 1.8 capital employed 2014 1.6 • Leading technologies in 1.4 − Upstream – seismic imaging and enhanced 1.2 oil recovery 1.0 Competitor range − Downstream – 0.8 petrochemicals and 0.6 BP formulated products 0.4 • Efficiency of extraction 0.
Slide 35: Technology – venturing
Technology – venturing Our venture portfolio Oil and gas • 38 investments Heliex Power – Screw expander that recovers energy from wet steam or two phase fluids to generate electricity • Supporting efficiency of Biosynthetic Technologies – creates “biosynthetic” oils core oil and gas from plant fatty
Slide 36: Technology – university & public-private partnerships
Technology – university & public-private partnerships Energy Sustainability Challenge Energy Biosciences Institute Carbon Mitigation Initiative BP International Centre for Advanced Materials BP Institute of Multiphase Flow 36
Slide 37: Technology Outlook – key messages
Technology Outlook – key messages • Energy resources are plentiful • The power sector offers greatest scope for reducing emissions • Transport is set to become more fuel efficient • Some emerging technologies could prove disruptive BP Technology Outlook – www.bp.com/technology 37
Slide 38: Bernard Looney: Operating safely, responsibly and efficiently
Bernard Looney Chief operating officer, production Operating safely, responsibly and efficiently
Slide 39: Agenda
Agenda Operating performance • Latest metrics • Performance in action • Looking to the future Environmental performance • Flaring reduction • Methane emission reduction • Building for the future 39
Slide 40: Operating performance – process safety
Operating performance – process safety 25 GOO process safety - Tier 1 events 20 15 10 5 0 2010 2011 2012 2013 2014 YTD 2015 Data excludes Lower 48 GOO – Global Operations Organisation 40
Slide 41: Operating performance – LOPCs
Operating performance – LOPCs 100 GOO loss of primary containment events (A-G) 80 60 40 20 0 2010 2011 2012 2013 2014 3Q 2015 Data excludes Lower 48 41
Slide 42: Operating performance – plant reliability
Operating performance – plant reliability GOO process safety - Upstream operated tier 1 events plant reliability 25 95% 20 90% 15 10 85% 5 0 80% 2010 2011 2012 2013 2014 YTD 2015 Data excludes Lower 48 42
Slide 43: Operating performance – today's technology
Operating performance – today’s technology
Slide 44: Operating performance – the future
Operating performance – the future Operating envelope monitoring Advanced condition monitoring Plant operations advisor Equipment reliability & availability monitoring
Slide 45: Flaring reduction - Azerbaijan
Flaring reduction - Azerbaijan
Slide 46: Methane reduction – leak detection and repair programme
Methane reduction – leak detection and repair programme 46
Slide 47: Building for the future - Oman Khazzan
Building for the future - Oman Khazzan
Slide 48: Qs and As
SRI annual meeting 13 November 2015 Qs and As
Slide 49: SRI annual meeting
SRI annual meeting 13 November 2015 49