BP plc · LSE:BP.
BP — Investor Day (October 2023)
35 slides from BP's investor day presentation, October 2023
Slide 1: Our strategy in action – Investor update Plenary
Investor update Plenary Our strategy in action ― Our strategy in action Investor update – Plenary October 2023 Welcome everyone to Denver – we’re delighted you’ve made the journey to join us here. We’ve got a great couple of days ahead of us. Our focus over the next two days is on our oil and gas bu
Slide 2: Cautionary statement
Investor update Plenary Our strategy in action ― Cautionary statement In order to utilize the ‘safe harbor’ provisions of the United States Private Securities Litigation Reform Act of 1995 (the ‘PSLRA’) and the general doctrine of cautionary statements, bp is providing the following cautionary state
Slide 3: A top tier US E&P and material driver of value growth to 2030+
Investor update Plenary Our strategy in action ― home of A top tier US E&P and material driver of value growth to 2030+ 3 Good morning everyone. Welcome to Denver and thanks for coming to our investor update. We are here in Denver today for our third upstream showcase – some of you might remember 20
Slide 4: Three key messages about bp
Investor update Plenary Our strategy in action ― 4 Before we get into the detail of today’s investor update, I’d like to start this morning by reinforcing three key messages about bp. 4
Slide 5: bp – performing while transforming
Investor update Plenary Our strategy in action ― bp – performing while transforming Strategy & net Focused on safety Growing zero ambition & quarter-on-quarter value & unchanged delivery returns 5 First, our strategy - transforming to an integrated energy company - is unchanged. Second, we are firml
Slide 6: ...we have more to do
Investor update Plenary Our strategy in action ― Living our safety Managing Improving our leadership principles operating risks safety performance ...to maintain a consistent ...to eliminate life ...to eliminate Tier 1 safety culture changing injuries process safety events Oil and gas process safety
Slide 7: Our strategy
Investor update Plenary Our strategy in action ― Our strategy 1 (1) Bioenergy includes biofuels marketing reported in convenience and mobility 7 Turning to our strategy - it is unchanged. We have been in action executing our strategy for over three years. Our transformation to an Integrated Energy C
Slide 8: Our disciplined financial frame
Investor update Plenary Our strategy in action ― Our disciplined financial frame Resilient Strong investment Disciplined Share dividend grade credit rating investment allocation buybacks per ordinary share 2023 surplus cash flow* 2023 capital expenditure* 2023 surplus cash flow1,2 for 2Q23 Resilient
Slide 9: Our capital expenditure and EBITDA targets and aims
Investor update Plenary Our strategy in action ― Our capital expenditure and EBITDA targets and aims Capital expenditure* $bn EBITDA* $bn 2021 2022 2025 target 2030 aim 2021 2022 2025 target 2030 aim $71/bbl $103/bbl $70/bbl2 $70/bbl2 Resilient 9.1 13.01 9-11 8-10 Resilient 30.63 56.93 40-42 41-44 h
Slide 10: Our pathway to net zero
Investor update Plenary Our strategy in action ― Our pathway to net zero Scope 2025 target 2030 aim 2050 or sooner aims Aim 1 Scope *1 1+2 20% 50% 100% Aim 2 Scope *1 3 10-15% 20-30% 100% Aim 3 Carbon *1 intensity2 5% 15-20% 100% Aim 4 Methane 0.20% intensity* (measurement approach) Aim 5 Transition
Slide 11: Growing the value of bp as we transform to an integrated energy company
Investor update Plenary Our strategy in action ― 11 We are working to grow the value of bp as we transform to an integrated energy company, by investing in both today’s oil and gas system AND investing in our transition growth engines. This was our message to you back in February with our strategy u
Slide 12: Turning now to the next two days
Investor update Plenary Plenary Our strategy in action ― 12 Turning now to the next two days. 12
Slide 13: The focus of our investor update: oil and gas, biogas
Investor update Plenary Our strategy in action ― The focus of our investor update Oil and gas Biogas 1 (1) Bioenergy includes biofuels marketing reported in convenience and mobility (2) Growing to 2025 compared with 2021 13 Our oil and gas, and biogas businesses form part of our resilient hydrocarbo
Slide 14: Introducing the team in Denver
Investor update Plenary Our strategy in action ― 14 Before we go any further, let me introduce the team that are here with me in Denver. 14
Slide 15: Let's turn now to the main focus of today – oil and gas
Investor update Plenary Our strategy in action ― 15 Let’s turn now to the main focus of today – oil and gas. 15
Slide 16: Oil and gas value proposition
Investor update Plenary Our strategy in action ― Oil and gas value proposition Oil and gas production mboed Divestments 2,000 Growth options1 Major projects* Managed base 2021 2025 2030 Oil and gas EBITDA*2 $bn 3535 0 2021 2025 2030 (1) Future developments + risked exploration activity (2) Brent $70
Slide 17: Centralised projects & operations
Investor update Plenary Our strategy in action ― projects & operations... Agility Global Accelerating Centralisation Mass centralisation at scale standardisation digital ....leading to better results 17 Since we last saw you in Oman, we have significantly re-organised the oil and gas business. – We
Slide 18: Established operating track record
Investor update Plenary Our strategy in action ― Established operating track record Plant reliability* Managed base decline1 Operated emissions2 Aim 1 MtCO2e 96% 5% 55 3 - 5% 3% 0 2019 2020 2021 2022 Methane intensity* Aim 4 2019 2022 0.14% 0.05% 90 Installing methane measurement 2014 2020 2022 2014
Slide 19: Driving group operated emissions lower
surveillance. We are driving our group operated emissions lower. – Together with portfolio choices, we have reduced emissions from our operations by more than 40% since 2019, and delivered more than 4 million tonnes of CO2-equivalent sustainable emissions reductions. – We have delivered a 70% reduct
Slide 20: Strong performance across projects & operations
Investor update Plenary Our strategy in action ― Strong performance across projects & operations Drilling quartiles & completion NPT1 Projects schedule Unit production costs*5 Rushmore2 IPA ratio4 $/boe Top Quartile 2nd Quartile Completion non-productive time 100% 20 1.2 Industry 75% 15 50% 1.0 10 C
Slide 21: A resilient and efficient portfolio
Investor update Plenary Our strategy in action ― A resilient and efficient portfolio Upstream breakeven1 Net income per barrel of production* $/boe $/boe bp Competitor range2 Competitor range2 bp 2014 2016 2018 2020 2022 2014 2016 2018 2020 2022 Brent Brent $99/bbl $101/bbl (1) Post-tax proxy free c
Slide 22: Looking to the next frontier to transform projects & operations
Investor update Plenary Our strategy in action ― Looking to the Centre for Adaptive Expanding technical Mass centralisation operating Alliances digital excellence model …the next frontier to transform projects & operations 21 And what’s really exciting – we see potential to do more to transform our
Slide 23: Growing EBITDA to 2025
Investor update Plenary Our strategy in action ― Growing EBITDA to 2025 2025 targets Production1 Oil and gas EBITDA*2 Oil and gas capex* Target Delivery ~200mboed >50% Mad Dog Phase 2 Tangguh expansion Major project* KGD6-MJ Seagull – start-up start-ups from 9 new high-margin projects of ~200mboed t
Slide 24: bpx growth and confidence in 2025 delivery
to access highest margins – that is an immensely valuable option that we believe nobody else replicates at our scale. bpx is on-track to increase volumes by 30%-40% by 2025 compared to 2022, including growing liquids volumes to around 200 thousand barrels of oil per day by 2025. This growth is enabl
Slide 25: Sustaining EBITDA 2026-2030
Investor update Plenary Our strategy in action ― Sustaining EBITDA 2026-2030 2030 aims Production1 Oil and gas EBITDA*2 Oil and gas capex* bpx production Gulf of Mexico average Liquids production in 2030 production 2026-2030 CAGR 2022-20273 High-quality resources > 650 mboed ~ 350 mboed ~ 3% in core
Slide 26: Equity options and project FIDs through the decade
– Equity options include Browse in Australia, Calypso in Trinidad & Tobago, and potential future phases of Mauritania and Senegal, Oman, UAE and Indonesia. – And our global scale and deep relationships facilitate our competitive position to add new merchant opportunities. Such as the Woodfibre proje
Slide 27: The next wave of potential projects
Investor update Plenary Our strategy in action ― The next wave of potential projects UK & Norway Canada • Clair Phase 3^ • Valhall PWP# • Bay du Nord^ Azerbaijan • Infill drilling • Wisting# • Exploration • ACG infill • Yggdrasil# • Exploration • Shah Deniz compression^ bpx • Exploration • Permian s
Slide 28: Our plan to 2030
Investor update Plenary Our strategy in action ― Our plan to 2030 Oil and gas production Oil and gas unit margins Oil and gas EBITDA*2 mboed % of production $bn Managed base Major projects* Growth options1 <$20/boe $20-40/boe >40/boe 35 Divestments 2,000 0 2021 2025 2030 2021 2025 2030 2021 2025 203
Slide 29: Capacity to sustain EBITDA 2030+
Capital Markets Investor update Update Plenary oil Our strategy in action ― Capacity to sustain EBITDA 2030+ Our high-quality and distinctive resource portfolio 4 with Flexibility to respond to changing demand Development & unit production costs* ($/boe)5 ~ 36bn Deepwater Onshore Production mix Liqu
Slide 30: Deep hopper of options provides project optionality
Taken together, this deep hopper of options provides us with significant future project optionality and flexibility to allocate capital, allowing us to make choices to progress the best barrels and sustain EBITDA. 26
Slide 31: Turning now to biogas
Investor update Plenary Our strategy in action ― 27 Turning now to biogas. As I mentioned earlier, biogas is part of our bioenergy transition growth engine, alongside biofuels. 27
Slide 32: Scaling-up to be a market leader across the value chain
Investor update Plenary Our strategy in action ― Scaling-up to be a market leader across the value chain Biogas supply* mboed ~70mboed2 Actuals Equity 25% CAGR1 Rapidly growing, Offtake Archaea Energy supportive biogas market Leveraging and building advantaged, integrated 2022 2023 2025 2030 positio
Slide 33: Biogas production increases over many decades
over many decades, with increasing production through to landfill closure. 28
Slide 34: Growing the value of bp
Investor update Plenary Our strategy in action ― Growing the value of bp Investing in today’s oil and gas system 2025 EBITDA2 2030 EBITDA2 Oil and gas EBITDA* – unchanged – revised up Leading delivery model – improving efficiency $30 – 32bn to 20251 & performance – more to come $40 - 42bn $41- 44bn
Slide 35: Capacity to sustain EBITDA well into the next decade
– Capacity to sustain EBITDA at this level well into the next decade. Which supports increasing our 2030 resilient hydrocarbons EBITDA aim by $2 billion to $41-44 billion and 2030 group EBITDA aim to $53-58 billion, achieved with the same capital expenditure and production targets and aims. And, we’