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euro adhoc: BP PLC
BP First Quarter 2004 Trading Update (E)

  Disclosure announcement transmitted by euro adhoc.
  The issuer is responsible for the content of this announcement.
March 29, 2004
BP First Quarter 2004 Trading Update
This trading update is aimed at providing certain estimates
regarding revenue and trading conditions experienced by BP in the
first quarter ending March 31, 2004, and certain identified
non-operating items expected to be included in that quarter's
result. The first quarter margin, price, realisation, cost,
production and other data referred to below are currently
provisional, some being drawn from figures applicable to the first
month or so of the quarter. All such data are subject to change and
may differ quite considerably from the final numbers that will be
reported on April 27, 2004. The statement is produced in order to
provide greater disclosure to investors and potential investors of
currently expected outcomes, and to ensure that they all receive
equal access to the same information at the same time.
Note on timing of release of trading update: BP intends to release
future trading updates at 0700 on the second business day following
the quarter end. The 1Q'04 trading update has been issued today
prior to the quarter close, to coincide with today's Strategy
Update briefing, at which the additional disclosures made in this
trading update will be discussed. It is intended to continue the
inclusion of these and other additional disclosures in future
trading updates.
Resources Business : Exploration and Production
Marker prices
1Q'04*    4Q'03    3Q'03    1Q'03  
  Brent dated ($/bbl)            32.03     29.43    28.38    31.49  
  WTI ($/bbl)                    35.30     31.15    30.19    34.00  
  ANS USWC ($/bbl)               34.22     29.43    28.83    33.17  
  US gas Henry Hub first of      5.69      4.58     4.97     6.53   
  month index ($/mmbtu)                                             
  UK gas price - National        28.7      27.3     15.1     21.3   
  Balancing Point (p/therm)
* as at March 25, 2004
Profit centres excluding Russia:
Production in 1Q'04, excluding volumes from our Russian operations,
is expected at approximately 3,170mboed, down slightly from 4Q'03
due to divestments and events including a strike in Trinidad and
unplanned losses at Northstar in Alaska.
Relative to 4Q'03, liquids realizations are moving in line with
markers. Relative to 4Q'03, gas differentials in North America
widened slightly due to regional demand. The 1Q'04 impact of
Unrealised Profit in Stock (UPIS) is expected to reduce earnings by
approximately $30m.
Russia  
Marker Prices
1Q'04    4Q'03    3Q'03    1Q'03  
    Urals (NWE - cif) ($/bbl)   28.15    27.90    27.15    29.60  
    Urals (Med - cif) ($/bbl)   28.35    28.00    27.15    29.75  
    Domestic Oil ($/bbl)        17.40    17.21    16.08    5.50
Russian Production Estimate
Production in mboed's   1Q'04    4Q'03    3Q'03*    1Q'03*
TNK-BP : oil            765      669      654       585     
     gas                     65       51       41        45
*BP's acquisition of its 50 per cent share in TNK-BP was completed
on August 29, 2003. Estimate for 1Q'04 includes TNK-BP's interest
in Slavneft. Production information for prior periods is shown for
comparison purposes only.
In 1Q'04, BP's net share of production from Russia is anticipated
to be approximately 830mboed, as shown in the table above.
During 1Q'04, domestic oil prices have remained unusually high as
warmer weather has allowed product to be exported to the
international market. However, we anticipate that higher domestic
prices should be offset by higher lagged production taxes rolling
over from 4Q'03.
Customer facing Businesses
* Gas, Power and Renewables
Gas marketing margins are expected to be higher than 4Q'03 in North
America and in the LNG business in line with higher seasonal
margins seen over the past few years. NGL margins are anticipated
to be similar to those in 4Q'03.
* Refining and Marketing
Refining Indicator Margins ($/bbl)*
1Q'04    4Q'03    3Q'03    1Q'03  
        USA                                                   
        - West Coast        7.58     6.09     9.04     6.77   
        - Gulf Coast        6.79     3.53     5.61     6.14   
        - Midwest           4.50     2.89     6.39     4.14   
        North West Europe   2.63     2.21     2.47     3.70   
        Singapore           3.48     2.20     1.27     2.98
Refining Global Indicator Margin**      4.46   3.14   4.59   4.52 
  ($/bbl.)
*As at March 25, 2004
**The refining Global Indicator Margin (GIM) is a weighted average
based on BP's portfolio. Actual margins may vary because of
refinery configuration, crude slate and operating practices.
Refining indicator margins are expected to be generally higher in
1Q'04 than in 4Q'03, particularly in the US, due to strong demand,
cold weather and concerns over US gasoline supplies. Refinery
availability in 1Q'04 is expected to be slightly lower than in
4Q'03 due to the outage at the Whiting refinery in February. Retail
margins in 1Q'04 are expected to be similar to those in 4Q'03
against lower seasonal demand patterns.
* Petrochemicals
Chemicals Indicator Margin ($/te) *
1Q'04                                  4Q'03     3Q'03    1Q'03  
  n/a                                    114**     109      96
* The Chemicals Indicator Margin (CIM) is a weighted average of
externally-based product margins. It is based on market data
collected by Nextant (formally Chem Systems) in their quarterly
market analyses, then weighted on BP's product portfolio. This is
described more fully in the Group's quarterly results releases.
** 4Q'03 provisional est.
BP petrochemical margins are expected to be broadly in line with
4Q'03. Strengthening product realisations, are expected to be
offset by higher energy costs, feedstock prices and the effect of a
strong Euro.
Identified non-operating Items
In 1Q'04, material gains and losses on divested assets are
currently expected to amount to a gain of around $1.3bn pre-tax.
Included within this figure are expected gains on the sales of our
equity stakes in PetroChina and Sinopec of $1.3bn, the reversal of
a loss on the sale of certain upstream Venezuelan assets in 2003 of
$0.2bn and expected losses on the sale of certain assets in the
customer facing businesses totaling $0.2bn.
Interest Expense
We expect interest expense to be around $60m lower than 4Q'03,
mainly driven by lower debt, and lower net financing expense from
our pensions and benefits plans under FRS 17.
Tax Rate
The effective tax rate for the quarter is expected to be around 35
per cent, compared with the equivalent rate in 4Q'03 of 33.5 per
cent. Collectively, there is no expected tax effect arising from
the identified non-operating items mentioned above.
Gearing
Gearing for the quarter is expected to fall below the bottom end of
our target 25-35 per cent band. The sale of shares in PetroChina
and Sinopec will more than offset the $1.4bn paid for our share of
TNK-BP's 50 per cent interest in Slavneft.
Stock Purchases
During the quarter the company bought back for cancellation 155m
shares for a total consideration of $1.25bn. Shares in issue as at
February 28, 2004 were 22,090 million. BP has entered into an
arrangement that will allow it to continue the share buy back
program during the close period commencing April 1, 2004.
Rules of Thumb
The following rules of thumb can be used to estimate the impact of
changes in the trading environment on BP's 2004 pre-tax earnings.
These rules of thumb are approximate. In particular the impact of
large movements in the trading environment relative to that of
4Q'03 may differ from those implied by the rules of thumb. Many
other factors will affect BP's earnings quarter by quarter. Actual
results may therefore differ significantly from the estimates
implied by the application of these rules.
2004 Operating Environment Rules of Thumb : pre tax per year
Full Year 
             Oil Price                                   
             Brent +/- $1/bbl                  $570m     
             Gas - Henry Hub +/- $ 0.10/mcf    $110m     
             Refining* - GIM +/- $ 1/bbl       $1120m    
             Petrochemicals - CIM +/- $10/te   $200m
*Particular differences may arise between GIM and BP's realized
refining margins due to crude price levels and differentials,
product price movements and other factors.
- ENDS -
This information is provided by RNS
            The company news service from the London Stock Exchange
end of announcement        euro adhoc 29.03.2004

Further inquiry note:

Jude Tomalin
Company Secretarial Assistant
- 020 7496 4062

Branche: Energy
ISIN: GB0007980591
WKN: 850517
Index:
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