The%20BP%20Story

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The BP Story

• Brian Miller
• AGI Leadership Forum May 1, 2006

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Who we are
BP is an oil, gas, petrochemicals and renewables
company We employ around 102,900 people We have
operations on 6 continents and in over 100
countries
market capitalization 231 billion (as at 7 Feb
2006)
annual revenues/turnover of 253 billion (in
2005)
the 2nd largest oil gas company and one of the
10 largest companies in the world
serving 13 million customers every day
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What we do
BUSINESS SEGMENTS
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Our global presence
Oil Gas Chemicals Refining Market positions
An opportunity and a responsibility
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Where our people come from

1. Some Mobil employees became part of BP staff
   post dissolution of JV in Europe
2. BP acquired some Belgium assets

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Reserves and enterprise value 1997
EV bn
300
250
200
Shell
Exxon
150
100
BP
Mobil
Texaco
ENI
Elf
ARCO
50
Chevron
REP
Amoco
Fina
TOT
0
Philips
5.0
10.0
15.0
20.0
25.0
Reserves billion boe
End of year 1997, based on published data
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SectorStructural Change since 1997
350
Exxon/Mobil
300
BP
250
Royal Dutch Shell
200
Enterprise Value bn
TOTAL
150
ENI
Chevron
100
Repsol
50
Conoco/Phillips
0
0.0
5.0
10.0
15.0
20.0
25.0
Proved Reserves boe billion
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The worlds largest companies

• Market Cap (bn) Company
• 382 1 General Electric
• 380 2 Exxon Mobil
• 262 3 Microsoft
• 234 4 Citigroup
• 221 5 BP
• 212 6 Wal-Mart Stores
• 210 7 Royal Dutch/Shell
• 199 8 Johnson Johnson
• 195 9 Pfizer
• 178 10 Bank of America
• 176 11 HSBC
• 171 12 Vodaphone
• 165 13 IBM
• 148 14 Total
• 144 15 Intel Corporation

Source Financial Times 31 March 2005
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Our aspirationA great future
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Our aspiration and our purpose

• To be numbered amongst the worlds great
  companies when evaluated on financial returns and
  growth, being a great place to work and building
  a positive relationship with society.
• BPs strategy, February 2004

Our fundamental purpose as an organization is to
provide better goods and services in the form of
light, heat, power and mobility to increasing
numbers of people and thereby to deliver
shareholder value on a long term
basis. Sustainability Report 2005
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Key dimensions of great companies
Top brand
Admired and respected by peers
Great company
Financial performance
Recommended by brokers
Desirable employer
Source McKinsey
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Our business strategyFuelled with possibilities
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Existing profit centers
Existing profit centers managed decline
Alaska
North Sea
North America Gas
Egypt
Middle East
Latin America
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New profit centers
Capital efficiency project delivery
TNK-BP
Azerbaijan
Gulf of Mexico Deepwater
North Africa
Trinidad
Angola
Asia Pacific
For further information contact Michael Elliott
michael.elliott2_at_uk.bp.com
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Connecting to the Future--Business and Policy
Intersections
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BP is a gas supermajor

• Gas now makes up some 40 of BPs total production

• BP is one of the worlds largest gas marketer and
  traders providing gas to customers in 26 countries

• We are the second largest supplier of gas into
  LNG plants

Our medium-term intent is to grow by 2 to 3 a
year, in line with global gas demand by

• realising the full potential of existing and new
  profit centres

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Alternative Energy

• In 2005, we established a new business called BP
  Alternative Energy to generate and market
  cleaner, low carbon power from solar, wind,
  hydrogen and natural gas sources.
• 8 billion investment over 10 years.
• Globally, the power sector is the biggest source
  of greenhouse gas emissions responsible for
  about twice the emissions of the transport
  sector.
• Some 40 of the power-generating capacity
  required to meet projected world electricity
  demand in 2020 has yet to be built.
• The business will initially employ around 2,500
  people.

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Alternative Energy

• Solar
• Operating for over 30 years we are one of the
  worlds top three solar manufacturers and
  marketers.
• We plan to increase sales of solar panels from
  110MW capacity to 300MW by 2008.
• Wind
• We have constructed two wind farms in the
  Netherlands producing enough power for over
  15,000 Dutch homes.
• Under Alternative Energy we aim to grow our wind
  business from 30MW to 450MW in 2008 and become a
  Top Tier player by 2015.
• Hydrogen Power
• Generating power from hydrogen using fossil fuels
  such as coal, oil and natural gas. In June 2005
  we announced our plans to design the worlds
  first commercial hydrogen power plant in Scotland
  and earlier this year we announced a proposal to
  build a second plant in California.
• The carbon dioxide emissions from generating
  power in this way are 90 lower than those that
  would be generated by burning fossil fuels.

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Alternative Energy

• Natural Gas to Power
• BP already owns, operates or contracts 12
  gigawatts of gas-fired power capacity enough to
  power over 10 million homes.
• The majority of these plants produce electricity
  with combined cycle gas turbines and cogeneration
  plants.
• Over the next 3 years we plan to start
  construction of two new gas-fired cogeneration
  power facilities with an output of more than 700
  megawatts.
• Power Marketing Trading
• Among the top tier power marketers in North
  America.
• In 2004, we provided customers with 300 million
  megawatt hours of electricity.
• We also provide our wholesale customers with
  secure, reliable electricity and innovative risk
  management services to help reduce price
  volatility.
• In many markets we are able to offer a number of
  low-carbon products, including certified green
  electricity, as well as integrated solar and
  clean grid power solutions.

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Our challengeA sustainable existence
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Sustainability How we work

• Sustainability is fundamental to our purpose as
  a group. Everything we do is designed to achieve
  the goal that our board sets on behalf of our
  shareholders, to maximize shareholder value on a
  long-term basis. In order to maintain value in
  the long term, we not only have to develop a
  successful business strategy but pursue it in
  such a way that we earn the trust of
  shareholders, customers, local communities,
  governments and others whose support is critical
  to our long-term future. To retain that trust we
  have to behave responsibly and consistently.
• BPs Sustainability Report 2004 (published April
  2005)

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BPs business profile continues to change
Source 2005 2008 BP estimates
Changes to our asset portfolio present
reputational risks that drive our increasing
focus on corporate responsibility
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Environment Climate change context

• Worlds estimated annual emissions from
  hydrocarbon consumption is nearly 25 billion
  tonnes of CO2
• Emissions from BPs productsaccount for approx
  5 of global CO2 emissions
• BPs operations contribute less than 0.4 of
  annual global emissions
• We are looking at ways to reduce emissions from
  our products as well as our operations

Slide 2
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Environment Our position on climate change
Our position is that there is no single solution!

• We will continue to focus on three main areas
• Provide leadership
• Continue to reduce the carbon content or impact
  of our products
• Continue to minimise our operational emissions

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BP brand story
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Perceptions

• A global enterprise
• An energy company
• An organisation that cares about the environment

• British company
• Big oil company that makes a lot of money

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Our brand aspiration
We want to build one of the worldsgreat
brands by building anorganisation devoted to
revolutionisingthe worlds relationship with
energy. Lord Browne (2000)
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USA
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A brand
Communicates a promise. Evokes a set of
expectations and associations - from every
experience with a person, product, service or
company

• Experiences
• How we work
• What we say
• What we do
• What we stand for
• How we deliver value

Reputation
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BP brand themebeyond petroleum..
Beyond is about
it does Not mean we are

• abandoning oil and gas or getting out of
  hydrocarbons
• focusing only on alternatives (renewables)
• the products we produce and sell, but it is also
  about our relationships how we think, behave
  perform as a company
• referring to it as the name of the company
• using it just as an expression in advertising

• reaching past one company to combine the talents
  of many
• delivering performance without trade-offs
• its the courage to lead, not just the ability
  to compete
• innovating, improving making a difference
• being creatively engaged and applying the skills
  we have to provide answers, not excuses

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Thank you Questions???