BP plc · LSE:BP.
BP — Investor Day (2018)
16 slides from BP's investor day presentation, 2018
Slide 1: Track record: BPX Energy
Track record BPX Energy Dave Lawler CEO, BPX Energy Brian Pugh COO, BPX Energy BP UPSTREAM INVESTOR DAY AND FIELDTRIP
Slide 2: BPX Energy core values, mission, and strategy
BPX Energy core values, mission, and strategy Core values Mission Strategy Safety and the Build a premier Develop newly acquired environment independent onshore and legacy shale plays business focused on through efficient capital delivering free cash investment and flow growth advanced technol
Slide 3: Mission delivery
Track record Mission delivery Proven Proven Material free assets track record cash flow growth Proven top-tier assets Proven track Material free cash flow located in the core of the record of execution growth achieved through Permian, Eagle Ford and synergies, capital efficiency, Haynesville shale p
Slide 4: BHP acquisition – base case + upside
Track record BHP acquisition – base case + upside1 increasing confidence that value creation can exceed model $65 WTI $3.25 HH Further upside potential Base case $55 WTI $2.75 HH $45 WTI Midstream $2.25 HH $10.5bn Upstream Purchase price BHP assets Synergies Capital efficiency Additional Environment
Slide 5: Proven Permian, Eagle Ford, and Haynesville acreage
Track record Proven Permian, Eagle Ford, and Haynesville acreage Permian Eagle Ford Haynesville 128 active rigs in Reeves, Culberson 44 active rigs across 5 counties 51 active rigs in Haynesville and Loving counties >1,800 wells in Eagle Ford since >275 wells since 2018, with average >1,
Slide 6: Stellar economics across a range of prices
Track record Stellar economics across a range of prices Breakeven WTI1 4.6bn boe resource base from BHP US onshore Resources Locations asset acquisition bn boe 0.3 0.3 500 Highly economic across a variety of price ranges 2,700 Short-cycle position, largely held by production 2,700 2.0 2.0 Ad
Slide 7: Synergies – >$350m annually from three categories
Track record Synergies – >$350m annually from three categories On track to deliver synergies ahead of plan General & administrative Production cost Financial $200-220m $100-120m $50-60m Scaled engineering Intelligent Operations Trading and development teams Supply chain optimisation Fiscal
Slide 8: Capital efficiency – primary development
Track record Capital efficiency – primary development high-density, multi-zone, long-lateral development strategy Permian subsurface Haynesville subsurface (including legacy) Up to 6 wells Avalon 3 wells Bossier Up to 8 wells 2nd Bone Spring Wolfcamp XY Wolfcamp A 3 wells Haynesville Up to 24 wells
Slide 9: Additional resource potential
Track record Additional resource potential under-developed zones prevalent across three plays Permian subsurface Haynesville subsurface (including legacy) Up to 6 wells Avalon 3 wells Bossier Up to 8 wells 2nd Bone Spring Wolfcamp XY Wolfcamp A 3 wells Haynesville Up to 24 wells Wolfcamp B 1-2 mile
Slide 10: Permian integrated development plan
Track record Permian integrated development plan installation of midstream assets to improve capital efficiency and decrease operating costs Completing wells Centralised processing Controlling midstream assets aligns the entire value chain for more efficient Gas development On demand Compression w
Slide 11: Proven track record: legacy Southern Haynesville
Track record Proven track record established top tier performance in legacy Southern Haynesville play Average single well cumulative production BPX gross production in Haynesville cumulative gross gas volume, mmboe gross production, mboed, number of wells 1.6 100 50 80 40 1.2 number of wells 60 30 m
Slide 12: Proven track record: intelligent operations cost reduction
Track record Proven track record material cost reduction achieved through proprietary intelligent operations model Traditional operating model: disparate Company operated unit Headcount systems and data silo information require production costs ‘000s labor intensive processes to manage $/bbl outco
Slide 13: Intelligent operations example
Track record Intelligent operations example algorithm based work management system Proprietary system more efficiently manages workforce & activity 43% fewer workers doing 10% more work, with higher value Directly translates to acquired assets Creates value through cost savings and revenue maxim
Slide 14: Near term development – Permian, Eagle Ford & Haynesville
Track record Near term development – Permian, Eagle Ford & Haynesville 2019 Plan Planned Divestments 2019-2021 Plan ~$2bn Capital ~$2-2.5bn Wamsutter 2019 capital p.a. Rig 16 San Juan Rig 15-25 count operated count operated rigs rigs Anadarko Arkoma 5-10 in Permian 2019 wells to be drilled >250
Slide 15: Transforming the portfolio
Track record Transforming the portfolio simplifying the business and increasing liquids production BP Lower 48 BPX Energy before acquisition (2018) post-integration (2021) Operated wells 9,400 3,500 Basins 6 3 Capital budget ~$950m ~$2-2.5bn Production1 315mboed ~500mboed Oil % of production mix ~5%
Slide 16: BHP acquisition – base case + upside
Track record BHP acquisition – base case + upside1 increasing confidence that value creation can exceed model $65 WTI $3.25 HH Further upside potential Base case $55 WTI $2.75 HH $45 WTI Midstream $2.25 HH $10.5bn Upstream Purchase price BHP assets Synergies Capital efficiency Additional Environment