BP BP Plc

By David Hodari

Shares in BP PLC (BP.LN) were sharply higher Tuesday morning after the company said it was raising its dividend, despite reporting a 26% drop in fourth-quarter earnings. Here are some other remarks from the report:

On upstream developments:

"In 2019 BP announced seven discoveries. In December, it confirmed the success of a three-well drilling campaign offshore Mauritania and Senegal, offering the potential for possible future developments. The Alligin project, a tie-back to the Quad 204 development west of Shetland, UK, began production ahead of schedule in December and was the fifth Upstream major project start-up of 2019. The Raven project in Egypt is now expected to come onstream around the end of 2020. Final investment decisions for five further projects, in the US Gulf of Mexico, UK North Sea, Azerbaijan and India, were taken in 2019."

On upstream disposals:

"In November BP agreed to sell its interests in the onshore San Juan and Arkoma fields in the US. In early January 2020, BP announced it had agreed terms to sell its interests in the Andrew area and in the Shearwater field, both in the central UK North Sea."

On the upstream outlook for 2020:

"We expect full-year 2020 underlying production to be lower than 2019 due to declines in lower margin gas basins. We expect reported production to be lower due to the above factor and the impact of the ongoing divestment programme. We expect first-quarter 2020 reported production to be lower than fourth-quarter 2019 due to the impact of our ongoing divestment programme and planned seasonal maintenance and turnaround activities."

On downstream strategic progress:

"In December, BP signed key agreements with Reliance Industries Ltd. to form a new fuels marketing joint venture, which will build on Reliance's existing network of retail sites in India and include access to the country's aviation fuels market. A consortium of leading companies across the PET plastics value chain, including BP, was formed. It aims to help accelerate the commercialisation of BP's enhanced recycling technology, BP Infinia, which is capable of processing currently-unrecyclable plastic waste."

On the downstream outlook for 2020:

"Looking to the first quarter of 2020, we expect lower levels of industry refining margins and wider North American heavy crude oil discounts compared with the fourth quarter of 2019."

On 'advancing the energy transition':

"In December BP increased its interest in its solar joint venture Lightsource BP, creating a simplified equal ownership structure with the company's management. The cash injection will support Lightsource BP's planned continuing rapid growth. The formation of the BP Bunge Bioenergia joint venture has completed. BP's 50% share in the company represents a 50% increase in BP's Brazilian biofuels and biopower business. BP continued to progress its advanced mobility agenda in 2019, forming an electric vehicle charging joint venture in China with DiDi and beginning the roll out of 150kW ultra-fast electric chargers on BP forecourts across the UK."

On wind:

"Net wind generation capacity was 926MW at 31 December 2019, compared with 1,001MW at 31 December 2018 . BP's net share of wind generation for the fourth quarter and full year was 785GWh and 2,752GWh respectively, compared with 933GWh and 3,821GWh for the same periods in 2018. The lower production and reduced capacity in 2019 is due to divestments in the fourth quarter of 2018 and second quarter of 2019."

On solar:

"Lightsource BP has an operating portfolio of 2GW of solar projects under its management and has plans for 10GW of developed assets by the end of 2023. During the fourth quarter BP increased its shareholding, to become an equal partner in the business, with the balance of shares continuing to be held by Lightsource BP's management and staff. In November, Lightsource BP became the first company in the UK to provide a reactive power service from a solar plant at night following a successful trial at its East Sussex solar plant. The trial follows three years of testing and development working with UK Power Networks and the National Grid Electricity System Operator."

Write to David Hodari at david.hodari@wsj.com

(END) Dow Jones Newswires

February 04, 2020 06:03 ET (11:03 GMT)

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