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BP profits fall

Bbc
Friday, February 08, 2013

OIL giant BP has posted a fall in full-year profits after setting aside money to cover liabilities for the Deepwater Horizon disaster.

Replacement cost profit, which strips out the effect of oil price movements, was $US17.6billion ($F30.9b) in 2012 — down from $US21.7b ($F38.2b) a year earlier.

It comes days after a US court approved a record $4bn criminal fine against BP over the fatal Gulf of Mexico disaster.

BP made $US4b ($F7.04b) in the fourth quarter, against $US5b ($F8.8b) for the 2011 period.

Despite the profits fall, the figures beat analysts' expectations. BP said its downstream activities — refining and sales of petroleum products — earned a record amount for the year. Its share price was up 2 per cent in morning trading.

BP in October agreed to sell its 50 per cent stake in TNK-BP to the Russian state-owned energy company Rosneft in return for cash and shares.

"We have moved past many milestones in 2012, repositioning BP through divestments and bringing on new projects. This lays a solid foundation for growth into the long term," said BP chief executive Bob Dudley.

But some analysts said they would remain sceptical about the company's outlook until all claims are settled.

Richard Hunter, head of equities at Hargreaves Lansdown Stockbrokers said in a research note: "BP made much progress during the full year, yet it is still far from being out of the woods."

The 2010 Deepwater Horizon incident was one of the worst environmental disasters in US history.

It killed 11 workers and released millions of barrels of crude into the Gulf of Mexico over 87 days.

BP said it took an additional $US4.1b ($F7.2b) charge in the fourth quarter, related to its settlement agreement with the US Department of Justice, in which it agreed to plead guilty to 14 criminal charges.





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