After setting out its new purpose, net zero ambition, structure and strategy in 2020, BP’s focus is now on delivering its transformation into an Integrated Energy Company.  

Since introducing its new purpose, net zero ambition, organisation and strategy in 2020, BP has built strong momentum across its strategy and delivered value for shareholders. BP chief executive Bernard Looney said: “It’s clearer than ever after the past three years that the world wants and needs energy that is secure and affordable as well as lower carbon – all three together, what’s known as the energy trilemma. To tackle that, action is needed to accelerate the transition. And – at the same time – action is needed to make sure that the transition is orderly, so that affordable energy keeps flowing where it’s needed today. 

 “As an integrated energy company, BP is very deliberately set up to help on both counts. With three years of delivery and track record – we have increased confidence our strategy is working. And with today’s announcement we are leaning further in. We are growing our investment into our transition and, at the same time, growing investment into today’s energy system. In doing so – we see tremendous opportunity to create value. And it’s what governments and customers are asking of companies like us.”

BP plans to support this growth by disciplined increases in investment over the period to 2030 of up to $8 billion in the TGEs and up to $8 billion in oil and gas. BP is adjusting its target capital expenditure range to $14-18 billion a year out to 2030, from the previous range of $14-16 billion. All investments will remain subject to disciplined application of BP’s balanced investment and returns criteria. BP is now targeting group EBITDA of $46-49 billion in 2025 and is aiming for $51-56 billion in 2030, in a $70/barrel (2021 real) oil price environment. These compare to its previous target and aim, from May 2022, of around $38 billion in 2025 and $39-46 billion in 2030 at $60/barrel (2020 real).  

 Bernard Looney: “Throughout 2022, BP continued to focus on delivery of our Integrated Energy Company strategy. We are helping provide the energy the world needs today and – at the same time – investing with discipline into our transition and the energy transition – as demonstrated by the Archaea Energy acquisition. We are strengthening BP, with our strongest upstream plant reliability on record and our lowest production costs in 16 years, helping to generate strong returns and reducing debt for the 11th quarter in a row. Importantly, we are delivering for our shareholders – with buybacks and a growing dividend. This is exactly what we said we would do and will continue to do – performing while transforming.”

In 2022, BP delivered EBITDA of $61 billion, operating cash flow of $41 billion, including around $7 billion working capital build, and reported underlying replacement cost profit of $28 billion. It continued to strengthen its finances, reducing net debt by $9.2 billion over the year to $21.4 billion – the lowest for over nine years. ROACE for the year was 30.5%. For 2022, BP incurred a total tax charge of $15.1 billion on an underlying basis, representing an effective tax rate of 34%. With plans for $2.75 billion share buybacks from fourth quarter surplus cash flow announced, BP has also announced a total of $11.25 billion share buybacks from 2022 surplus cash flow.