BP profit down as production hit by Gulf spill
BP yesterday reported a drop in quarterly profit as the Gulf of Mexico spill continues to take its toll on the company’s operations.
The oil major said that it had been hit by a dip in production in its first quarter as it was forced to sell off some fields to meet the bill for the disaster.
BP warned that the output problems would continue into the second quarter as it is looking to offload projects including Holstein and Marlin fields in the Gulf of Mexico.
The company reported a $4.9bn (£3bn) replacement cost profit – which strips out the impact of oil price movements – for the first three months of 2012 compared with $5.6bn a year ago.
But chief executive Bob Dudley insisted the company was still on track with its turnaround plan. He said: “We have made a good start against our strategic priorities for 2012.
“During the quarter we gained access to significant new deepwater and US shale exploration acreage, our ongoing divestment programme has reached $23bn.”
Last month BP reached a proposed settlement to resolve economic, property and medical claims by more than 100,000 individuals and businesses.
The total charge on the disaster, which claimed 11 lives after an explosion at the company’s Deepwater Horizon project, is estimated at $37bn.
Tony Shepard, oil analysts at Charles Stanley, said: “BP’s share valuation has yet to recover from the Deepwater Horizon tragedy,” pointing out that BP’s pre-spill peak was around 630p.