BP

This article is about the energy company. For other uses, see BP (disambiguation).

BP p.l.c.

File:BP Logo.svg
Company type	Public limited company
Traded as	LSE: BP, NYSE: BP
ISIN	DE0008618737
Industry	Oil and gas
Founded	1909 (as the Anglo-Persian Oil Company) 1954 (as the British Petroleum Company) 1998 (merger of British Petroleum and Amoco)
Headquarters	London, United Kingdom
Area served	Worldwide
Key people	Carl-Henric Svanberg (Chairman) Bob Dudley (CEO) Brian Gilvary (CFO)
Products	Petroleum Natural gas Motor fuels Aviation fuels
Services	Service stations
Revenue	US$ 386.46 billion (2011)
Operating income	US$ 39.81 billion (2011)
Net income	US$ 25.70 billion (2011)
Total assets	US$ 290.92 billion (2011)
Total equity	US$ 111.46 billion (2011)
Number of employees	79,700 (2011)
Website	www.bp.com

BP p.l.c. (LSE: BP, NYSE: BP) is a British multinational oil and gas company headquartered in London, United Kingdom. It is the third-largest energy company and fourth-largest company in the world measured by 2011 revenues and is one of the six oil and gas "supermajors". It is vertically integrated and operates in all areas of the oil and gas industry, including exploration and production, refining, distribution and marketing, petrochemicals, power generation and trading. It also has renewable energy activities in biofuels and wind power.

BP has operations in over 80 countries, produces around 3.4 million barrels of oil equivalent per day and has around 21,800 service stations worldwide. Its largest division is BP America, which is the second-largest producer of oil and gas in the United States. BP owns 50% of TNK-BP, which is the third-largest oil company in Russia measured by both reserves and crude oil production. As of December 2011, BP had total proven commercial reserves of 17.75 billion barrels of oil equivalent. BP has a primary listing on the London Stock Exchange and is a constituent of the FTSE 100 Index. It had a market capitalisation of £81.4 billion as of 6 July 2012, the fourth-largest of any company listed on the London Stock Exchange. It has a secondary listing on the New York Stock Exchange.

BP's origins date back to the founding of the Anglo-Persian Oil Company in 1909, established as a subsidiary of Burmah Oil Company to exploit oil discoveries in Iran. In 1935, it became the Anglo-Iranian Oil Company and in 1954 British Petroleum. In 1959, the company expanded beyond the Middle East to Alaska and in 1965 it was the first company to strike oil in the North Sea. British Petroleum acquired majority control of Standard Oil of Ohio in 1978. Formerly majority state-owned, the British government privatised the company in stages between 1979 and 1987. British Petroleum merged with Amoco in 1998 and acquired ARCO and Burmah Castrol in 2000.

BP has been involved in several major environmental and safety incidents, including the 2010 Deepwater Horizon oil spill, the world’s largest accidental release of oil into marine waters. In 1997 it became the first major oil company to publicly acknowledge the need to take steps against climate change.

History

1909 to 1979

Further information: Anglo-Iranian Oil Company and Iraq Petroleum Company

William Knox D'Arcy

A 1922 BP advertisement

In May 1901, William Knox D'Arcy was granted a concession by the Shah of Iran to search for oil, which he discovered in May 1908. This was the first commercially significant find in the Middle East. On 14 April 1909, the Anglo-Persian Oil Company (APOC) was incorporated as a subsidiary of Burmah Oil Company to exploit this. In 1912, APOC was the driving force behind the creation of Turkish Petroleum Company (TPC), which was promised an oil exploration concession in Mesopotamia (now Iraq) from the Ottoman government. By 1914, APOC held 50% of TPC shares.

In 1923, Burmah employed future Prime Minister, Winston Churchill as a paid consultant, to lobby the British government to allow it to have exclusive rights to Persian oil resources, which were successfully granted. In 1925, TPC received concession in the Mesopotamian oil resources from the Iraqi government under British mandate, and oil struck in Iraq on 14 October 1927. In 1928, the changing geopolitics as a result of the Ottoman empire breakup, and the Red Line Agreement; the APOC's shareholding in TPC, which by now named Iraq Petroleum Company (IPC), would be reduced to 23.75%.

In 1935, Rezā Shāh requested the international community to refer Persia as "Iran", which reflected in the name change of APOC to the Anglo-Iranian Oil Company (AIOC). The pro-west Hashemite Monarchy (1932–58) in Iraq, and IPC relations were generally cordial, in spite of disputes centered around more Iraqi involvement and getting more royalties. During the 1928-68 time period, IPC monopolised oil exploration inside the Red Line; excluding Saudi Arabia and Bahrain.

Following World War II, AIOC and the Iranian government initially resisted nationalist pressure to revise AIOC's concession terms still further in Iran's favour. But in March 1951, the pro-western Prime Minister Ali Razmara was assassinated. The Majlis of Iran (parliament) elected a nationalist, Mohammed Mossadeq, as prime minister. In April, the Majlis nationalised the oil industry by unanimous vote. The National Iranian Oil Company was formed as a result, displacing the AIOC. The AIOC withdrew its management from Iran, and organised an effective boycott of Iranian oil. The British government, which owned the AIOC, contested the nationalisation at the International Court of Justice at The Hague, but its complaint was dismissed.

By spring of 1953, incoming US President Dwight D. Eisenhower authorised the Central Intelligence Agency (CIA) to organise a coup against the Mossadeq government, known as the 1953 Iranian coup d'état. Classified documents show British intelligence officials played a pivotal role in initiating and planning the coup, and that Washington and London shared an interest in maintaining control over Iranian oil. The coup had its roots in Britain's conflict with Iran. On 19 August 1953, Mossadeq was forced from office by the CIA conspiracy, involving the Shah and the Iranian military, and known by its codename, Operation Ajax.

Mossadeq was replaced by pro-Western general Fazlollah Zahedi and the Shah, who returned to Iran after having left the country briefly to await the outcome of the coup. The Shah abolished the democratic Constitution and assumed autocratic powers.

After the coup, Mossadeq's National Iranian Oil Company became an international consortium, and AIOC resumed operations in Iran as a member of it. The consortium agreed to share profits on a 50–50 basis with Iran, "but not to open its books to Iranian auditors or to allow Iranians onto its board of directors." AIOC, as a part of the Anglo-American coup d'état deal, was not allowed to monopolise Iranian oil as before. It was limited to a 40% share in a new international consortium. For the rest, 40% went to the five major American companies and 20% went to Royal Dutch Shell and Compagnie Française des Pétroles, now Total S.A..

The AIOC became the British Petroleum Company in 1954. In 1959, the company expanded beyond the Middle East to Alaska and in 1965 it was the first company to strike oil in the North Sea. In 1978 the company acquired a controlling interest in Standard Oil of Ohio or Sohio, a breakoff of the former Standard Oil that had been broken up after anti-trust litigation. In 1967 the giant oil tanker, the Torrey Canyon, foundered off the English coast, even though the ship was flying the well known flag of convenience, that of Liberia. The ship was in fact operated on behalf of BP. The Prime Minister of that time, 1967, had the ship bombed by RAF jet bombers, in an effort to break the ship up and sink it (see Torrey Canyon oil spill). This was unsuccessful, and the method has not been repeated.

In Iraq, IPC ceased its operations after it was nationalised by the Ba’athist Iraqi government in June 1972. But the company "Iraq Petroleum Company" still remains extant as a name on paper, and one of its associated company - Abu Dhabi Petroleum Company (ADPC) - formerly Petroleum Development (Trucial Coast) Ltd - also continues with the original shareholding intact. In Iran, BP continued to operate until the Islamic Revolution in 1979. The new regime of Ayatollah Khomeini confiscated all of the company’s assets in Iran without compensation, bringing to an end its 70-year presence in Iran.

1979 to 2000

File:BP old logo.svg

Classic shield logo, designed by Raymond Loewy, updated in 1989, and used until 2002

Sir Peter Walters was the company chairman from 1981 to 1990. This was the era of the Thatcher government's privatisation strategy. The British government sold its entire holding in the company in several tranches between 1979 and 1987. The sale process was marked by an attempt by the Kuwait Investment Authority, the investment arm of the Kuwait government, to acquire control of the company. This was ultimately blocked by the strong opposition of the British government. In 1987, British Petroleum negotiated the acquisition of Britoil and the remaining publicly traded shares of Standard Oil of Ohio.

Walters was replaced by Robert Horton in 1989. Horton carried out a major corporate down-sizing exercise removing various tiers of management at the Head Office.

Standard Oil of California and Gulf Oil merged in 1984, the largest merger in history at that time. Under the anti-trust regulation, SoCal divested many of Gulf's operating subsidiaries, and sold some Gulf stations and a refinery in the eastern United States.

John Browne, who had been on the board as managing director since 1991, was appointed group chief executive in 1995.

2000 to 2010

BP stock value (open, high, low and close prices) on the New York Stock Exchange in 2000–2012

British Petroleum merged with Amoco (formerly Standard Oil of Indiana) in December 1998, becoming BP Amoco plc. In 2000, BP Amoco acquired Arco (Atlantic Richfield Co.) and Burmah Castrol plc. As part of the merger's brand awareness, the company helped the Tate Modern British Art launch RePresenting Britain 1500–2000 In 2001, the company formally renamed itself as BP plc and adopted the tagline "Beyond Petroleum," which remains in use today. It states that BP was never meant to be an abbreviation of its tagline. Most Amoco stations in the United States were converted to BP's brand and corporate identity. In many states BP continued to sell Amoco branded petrol even in service stations with the BP identity as Amoco was rated the best petroleum brand by consumers for 16 consecutive years and also enjoyed one of the three highest brand loyalty reputations for petrol in the US, comparable only to Chevron and Shell. In May 2008, when the Amoco name was mostly phased out in favour of "BP Gasoline with Invigorate", promoting BP's new additive, the highest grade of BP petrol available in the United States was still called Amoco Ultimate.

Chief scientist, Steven Koonin (top right, with laptop), speaks about the energy scene in the boardroom in 2005

In the beginning of 2000s, BP became the leading partner and later operator of the Baku–Tbilisi–Ceyhan pipeline project. The pipeline open a new oil transportation route from the Caspian region but was also criticised due to bypassing and regional isolation of Armenia, as well as for human rights and safety concerns.

In April 2004, BP decided to move most of its petrochemical businesses into a separate entity called Innovene within the BP Group. In 2005, it was sold to INEOS, a privately held UK chemical company for $9 billion.

In 2005, BP announced that it would be leaving the Colorado market. Many locations were re-branded as Conoco. In 2006, when Chevron Corporation gave exclusive rights to the Texaco brand name in the US Texaco sold most of the BP gas stations in the southeast. BP has recently looked to grow its oil exploration activities in frontier areas such as the former Soviet Union for its future reserves. In 2007, BP sold its corporate-owned convenience stores, typically known as "BP Connect", to local franchisees and jobbers.

On 12 January 2007, it was announced that Lord Browne would retire as chief executive at the end of July 2007. The new Chief Executive, Tony Hayward, had been head of exploration and production. It had been expected that Lord Browne would retire in February 2008 when he reached the age of 60, the standard retirement age at BP. Browne resigned abruptly from BP on 1 May 2007, following the lifting of a legal injunction preventing Associated Newspapers from publishing details about his gay lover. Hayward succeeded Browne with immediate effect.

In 2009, BP obtained a production contract during the 2009/2010 Iraqi oil services contracts tender to develop the "Rumaila field" with joint venture partner CNPC, which contain an estimated 17 billion barrels (2.7×10⁹ m³) of oil, accounting for 12% of Iraq's oil reserves estimated at 143.1 billion barrels. In June 2010, the BP/CNPC consortium took over development of the field, which was the epicentre of the 1990 Gulf war.

2010 to present

On 1 October 2010, Bob Dudley replaced Tony Hayward as the company's CEO after the Deepwater Horizon oil spill.

On 15 January 2011, Rosneft and BP announced a deal to jointly develop East-Prinovozemelsky field on the Russian arctic shelf. As part of the deal, Rosneft will receive 5% of BP's shares (worth approximately $7.8 billion, as of January 2011) and BP will get approximately 9.5% of Rosneft's shares in exchange. According to the deal, the two companies will also create an Arctic technology centre in Russia to develop technologies and engineering practices for safe arctic hydrocarbons extraction.

In February 2011, BP formed a partnership with Reliance Industries, taking a 30 percent stake in a new Indian joint-venture for an initial payment of $7.2 billion.

BP announced in June 2012 that it planned to sell its 50% shareholding in the Russian oil company TNK-BP, which accounted for 30 percent of BP’s oil and natural gas production, 20% of its reserves and roughly 10% of BP's profit over the last ten years. BP said that no sale was guaranteed, but that the company had received "indications of interest".

Operations

A BP service station in Turvey Park, New South Wales, Australia

BP has operations in around 80 countries worldwide. BP's global headquarters are located in the St James's area of London, United Kingdom and its exploration headquarters are located in Houston, United States. As of January 2012, the company had a total of 83,400 employees. Around 20% of the company's workforce is based in the United Kingdom and 28% is based in the United States. BP operations are organised into three main "business segments": Upstream, Downstream, and BP Alternative Energy.

United Kingdom

The BP chemicals plant in Salt End, United Kingdom

BP is the UK’s largest producer of oil and Europe’s second largest producer of natural gas. As of 2011 the company employs more than 15,000 people in the UK and Ireland, or about 20% of its total workforce. Its North Sea operations are headquartered in Aberdeen, Scotland, where it employs around 3,000 people.

BP operates more than 40 offshore oil and gas fields, four onshore terminals and a pipeline network that transports around 50 percent of the oil and gas produced in the UK, according to the company. As of 2011, BP had produced 5 billion barrels of oil and gas equivalent in the North Sea and its current level of production is about 200,000 barrels per day, BP has invested more than £35 billion in the North Sea since the 1960s, and in 2012 announced its plans to invest another £10 billion over the next five years, with six major projects in the UK and Norway under development.

Offshore oil fields under development by BP include the Clair oilfield, west of the Shetland Isles, which has been appraised as the largest hydrocarbon resource in the UK. In 2011, the UK government approved the development of an extension to the field, the Clair Ridge, for which BP will be the lead operator. As of 2012, the company announced that it was focusing its investment in the UK North Sea into four development projects including the Clair Field, Devenick gas field, the Schiehallion and Loyal oilfields and the Kinnoull oilfield.

In Saltend near Hull, BP operates a petrochemicals plant that produces acetic acid and acetic anhydride used in the production of pharmaceuticals, textiles and other chemical products. At the same location, the company operates a biofuel technology demonstration plant in partnership with DuPont, which uses feedstocks such as wheat to produce biobutanol. The company is also preparing to start production at a bioethanol plant in Hull, developed with Associated British Foods and DuPont.

BP has a major corporate campus in Sunbury-on-Thames which is home to around 4,500 employees and over 40 business units.. BP's trading functions are based at 20 Canada Square in Canary Wharf, London, where around 2,200 employees are based. BP also has three research and development facilities in the UK.

Retail sites operated by BP in the UK include over 1100 service stations. Its flagship retail brand is BP Connect, a chain of service stations combined with a convenience store and a café called the "Wild Bean Cafe". More than 120 BP Connect sites in the UK are run in partnership with Marks & Spencer and include an onsite M&S Simply Food shop.

United States

Part of the Trans-Alaska Pipeline System

In the United States, BP has the largest oil and gas reserves of any company and is the second-largest producer of oil and gas, and the largest producer in the deepwater Gulf of Mexico. In Alaska, BP operates 13 oil fields in the North Slope region and is the largest owner of the 800-mile long Trans-Alaska Pipeline System. In the lower 48 states, the company is the country's sixth largest natural gas producer with a total of 10,000 wells. Its alternative energy operations in the US include 13 wind farms and a $400 million investment in advanced cellulosic biofuels in Florida.

Other countries

Outside of the United Kingdom and United States, BP's key operations include offshore oil wells and onshore processing facilities in Brazil, Azerbaijan, Trinidad & Tobago and China. BP's largest onshore oil and gas exploration and production activities are based in Iraq, where it operates 20 oil rigs in the world's fourth largest oilfield, and Russia. In Indonesia, BP operates major liquid natural gas activities and began investment into coalbed methane in 2011. BP has announced a $7.2 billion investment in offshore oil and gas exploration in India. The company operates refineries in countries including Australia, New Zealand and South Africa. Its petrochemicals, lubricants, fuels and related services are marketed in Europe, Asia and Australasia. BP operates biofuel production facilities in Brazil, including three cane sugar mills for ethanol production.

Upstream

See also: Oil fields operated by BP

BP Upstream's activities include exploring for new oil and natural gas resources, developing access to such resources, and producing, transporting, storing and processing oil and natural gas. Upstream is responsible for the operation of BP's wells, pipelines, offshore platforms and processing facilities. The activities in this area of operations take place in 30 countries worldwide, including Angola, Azerbaijan, Brazil, Canada, Egypt, India, Iraq, Norway, Russia, Trinidad & Tobago, the UK, and the US.

Downstream

BP Downstream's activities include refining, marketing, manufacturing, transportation, trading and supply of crude oil, petrochemicals products and petroleum. Downstream is responsible for BP's fuels, lubricants and petrochemical businesses and has major operations located in Europe, North America and Asia. BP owns or holds a share in 16 refineries worldwide, of which seven are located in Europe and five are in the US. The company also has 21,800 service stations and markets its products in approximately 70 countries worldwide.

Air BP

A self-service Air BP fuelling station at the Kalamazoo/Battle Creek International Airport in Michigan, United States

Air BP is the aviation division of BP, providing aviation fuel, lubricants & services. It has operations in over 50 countries worldwide.

BP Shipping

BP Shipping provides the logistics to move BP's oil and gas cargoes to market, as well as marine structural assurance on everything that floats in the BP group. It manages a large fleet of vessels most of which are held on long-term operating leases. BP Shipping's chartering teams based in London, Singapore, and Chicago also charter third party vessels on both time charter and voyage charter basis.

The BP-managed fleet consists of Very Large Crude Carriers (VLCCs), one North Sea shuttle tanker, medium size crude and product carriers, liquefied natural gas (LNG) carriers, liquefied petroleum gas (LPG) carriers, and coasters. All of these ships are double-hulled.

Lubricants

Castrol is BP's main brand for industrial and automotive lubricants and is applied to a large range of BP oils, greases and similar products for most lubrication applications.

Service stations

An Aral service station in Weiterstadt, Germany

BP has around 21,800 service stations worldwide, which are primarily operated under the BP brand. In Germany and Luxembourg, BP operates service stations under the Aral brand, having acquired the majority of Veba Öl AG in 2001 and subsequently rebranded its existing stations in Germany to the Aral name. On the US West Coast, in the states of California, Oregon, Washington, Nevada, Idaho, Arizona, and Utah, BP primarily operates service stations under the ARCO brand, having acquired ARCO in 2000. ARCO is a popular "cash only" retailer, selling products refined from Alaska North Slope crude at the Cherry Point Refinery in Washington, a plant in Los Angeles, and at other contract locations on the West Coast.

BP Connect is BP's flagship retail brand and operates worldwide. BP Connect sites feature the Wild Bean Cafe, which offers cafe-style coffee and a selection of hot food as well as freshly baked muffins and sandwiches. BP Connect sites usually offer table and chair seating and often an Internet kiosk. Some BP Connect sites in the UK are run in partnership with Marks & Spencer, with the on-site shop being an M&S Simply Food. In the US, the BP Connect concept is gradually being transitioned to the ampm brand and concept.

In Australia BP operates a number of BP Travel Centres, large-scale destination sites located which, in addition to the usual facilities in a BP Connect site, also feature major food-retail tenants such as McDonald's, KFC, Nando's and Krispy Kreme, with a large seating capacity food court and facilities for long-haul truck drivers, including a lounge, showers and washing machines.

BP Canada operated retail locations in Canada from 1948 to 1982, which were sold and rebranded as Petro Canada.

BP Alternative Energy

The Fowler Ridge Wind Farm, of which BP is joint owner

BP's alternative energy business was launched in 2005 and invests in wind power and biofuel projects. In 2005 the company committed to spending $8 billion on renewable energy over 10 years and as of December 2011, had invested approximately $7 billion in this area.

Between 2005 and 2010, BP invested about $5 billion in its renewable energy business, mainly in biofuel and wind power projects. In 2011, BP planned to invest $1 billion in renewables, roughly the same amount it invested in 2010.

In 2011, BP announced a plan to construct a biofuel refinery in the Southeastern US. In 2010, it took a full control of Vercipia Biofuels, a cellulosic ethanol producer originally established as a joint venture with Verenium Corporation. The company says that it expects biofuels will make up 30% of the gasoline pool by 2030. BP says it views cellulosic ethanol as the energy to watch, noting the biofuel will compete in the market at $80 per barrel by 2022, with a yield 4 to 5 times that of corn.

In Brazil, BP holds a 50% stake in Tropical BioEnergia and plans to operate two ethanol refineries. In the US BP has more than 1,200 megawatts (MW) of wind-powered electricity capacity. In July 2010, the company began construction of the 250 MW Cedar Creek II Wind Farm in Colorado.

BP's former subsidiary BP Solar was a producer of solar panels after purchasing Lucas Energy Systems in 1980 and Solarex (as part of its acquisition of Amoco) in 2000. Through a series of acquisitions in the solar power industry BP Solar became the third largest producer of solar panels in the world. BP Solar had a 20% world market share in photovoltaic panels in 2004 when it had a capacity to produce 90 MW/year of panels. Due to competition from China, BP closed its US plants in Frederick, Maryland as part of a transition to manufacturing in China. In December 2011, BP Solar was closed and BP withdrew from the solar power industry, saying it was no longer profitable.

Corporate affairs

Senior management

BP's world headquarters in St. James's, City of Westminster, London

The headquarters of BP America in Westlake Park, Houston

The current members of the BP board of directors are:

• Carl-Henric Svanberg – Chairman;
• Robert Dudley – CEO (since 1 October 2010);
• Iain Conn – Chief Executive, Refining and Marketing;
• Brian Gilvary – Chief Financial Officer;
• Byron Grote – Executive Vice President, Corporate Business Activities;
• David Jackson – company secretary;
• Paul Anderson – non-executive director;
• Frank Bowman – non-executive director;
• Antony Burgmans – non-executive director;
• Cynthia Carroll – non-executive director;
• George David – non-executive director;
• Ian Davis – non-executive director;
• Ann Dowling – non-executive director;
• Brendan Nelson – non-executive director;
• Phuthuma Nhleko – non-executive director; and
• Andrew Shilston – non-executive director.

Financial data

Financial data in millions of US$

Year	2002	2003	2004	2005	2006	2007	2008	2009
Sales	180,186	236,045	294,849	249,465	265,906	284,365	361,341	239,272
EBITDA	22,941	28,200	37,825	41,453	44,835
Net results	6,845	10,267	15,961	22,341	22,000	20,845	21,157	16,578
Net debt	20,273	20,193	21,607	16,202	16,202

Source :OpesC

Company name

A BP service station in Ohio, United States showing the previous 'Green Shield' branding

Until 31 December 1998 the company was formally registered as the British Petroleum Company plc. Following a merger with Amoco the company adopted the name BP Amoco plc in January 1999, which was retained until May 2001 when the company was renamed BP p.l.c. In the first quarter of 2001 the company adopted the marketing name of BP, replaced its “Green Shield” logo with the Helios symbol, a green and yellow sunflower pattern, and introduced a new corporate slogan – “Beyond Petroleum”. The transition to the name and logo was managed by the advertising agency Ogilvy & Mather and the PR consultants, Ogilvy PR. The Helios logo (Helios is the name of the Greek sun god), is designed to represent energy in its many forms. BP's tagline, "Beyond Petroleum", according to the company represents their focus on meeting the growing demand for fossil fuels, manufacturing and delivering more advanced products, and enabling the material transition to a lower carbon future.

Environmental record

BP was named by Multinational Monitor as one of the ten worst corporations in both 2001 and 2005 based on its environmental and human rights records. In 1991 BP was cited as the most polluting company in the US based on EPA toxic release data. According to the Public Interest Research Group, between January 1997 and March 1998, BP was responsible for 104 oil spills.

Environmental initiatives

As of 11 February 2007, BP announced that it would spend $8 billion over ten years to research alternative methods of fuel, including natural gas, hydrogen, solar, and wind. A $500 million grant to the University of California, Berkeley, Lawrence Berkeley National Laboratory, and the University of Illinois at Urbana-Champaign, to create an Energy Biosciences Institute has recently come under attack over concerns about the global impacts of the research and privatisation of public universities.

BP patented the Dracone Barge to aid in oil spill clean-ups across the world.

BP was a founding sponsor of the University of East Anglia's Climatic Research Unit in 1971.

BP was a member of the Global Climate Coalition an industry organisation established to promote global warming scepticism but withdrew in 1997, saying "the time to consider the policy dimensions of climate change is not when the link between greenhouse gases and climate change is conclusively proven, but when the possibility cannot be discounted and is taken seriously by the society of which we are part. We in BP have reached that point.".

In March 2002, Lord John Browne, the group chief executive of BP, declared in a speech that global warming was real and that urgent action was needed, saying that "Companies composed of highly skilled and trained people can't live in denial of mounting evidence gathered by hundreds of the most reputable scientists in the world."

In 2009, Tony Hayward apparently shifted gears from former chief executive Lord Browne's focus on alternative energy, announcing that safety was the company's "number one priority".

In BP reports, the revenues for its Alternative Energy business is combined with its Shipping, Treasury and corporate activities. The alternative business is a negligible part of BP's overall value, though the division generates more than a billion in revenues annually.

Accusations of greenwashing

According to activist Antonia Juhasz, BP's investment in green technologies peaked at 4% of its exploratory budget prior to cutbacks, including the discontinuation of the Solar Programme and the closure of the alternative energy headquarters in London. Juhasz claims this amounts to an exercise in greenwashing. Greenpeace has questioned BP branding itself "Beyond Petroleum, citing its 2008 budget which included $20 billion in fossil fuel investment and $1.5 billion in all alternative forms of energy.

Hazardous substance dumping 1993–1995

In September 1999, one of BP’s US subsidiaries, BP Exploration Alaska (BPXA), agreed to resolve charges related to the illegal dumping of hazardous wastes on the Alaska North Slope, for $22 million. The settlement included the maximum $500,000 criminal fine, $6.5 million in civil penalties, and BP’s establishment of a $15 million environmental management system at all of BP facilities in the US and Gulf of Mexico that are engaged in oil exploration, drilling or production. The charges stemmed from the 1993 to 1995 dumping of hazardous wastes on Endicott Island, Alaska by BP’s contractor Doyon Drilling. The firm illegally discharged waste oil, paint thinner and other toxic and hazardous substances by injecting them down the outer rim, or annuli, of the oil wells. BPXA failed to report the illegal injections when it learned of the conduct, in violation of the Comprehensive Environmental Response, Compensation and Liability Act.

Prudhoe Bay 2006–2007

BP's Alaska office in Anchorage

Main article: Prudhoe Bay oil spill

In August 2006, BP shut down oil operations in Prudhoe Bay, Alaska, due to leaking wells. The wells were leaking an insulating agent called Arctic pack, consisting of crude oil and diesel fuel, which is placed between the wells and ice to prevent freezing. BP had also spilled over one million litres of oil in Alaska's North Slope due to corrosion in the feeding pipeline to the Alaska Pipeline. This corrosion is caused by sediment collecting in the bottom of the pipe, protecting corrosive bacteria from chemicals sent through the pipeline to fight these bacteria. There are estimates that about 5,000 barrels (790 m³) of oil were released from the pipeline. To date 1,513 barrels (240.5 m³) of liquids, about 5,200 cubic yards (4,000 m³) of soiled snow and 328 cubic yards (251 m³) of soiled gravel have been recovered. After approval from the DOT, only the eastern portion of the field was shut down, resulting in a reduction of 200,000 barrels per day (32,000 m³/d) until work began to bring the eastern field to full production on 2 October 2006.

In May 2007, the company announced another partial field shutdown owing to leaks of water at a separation plant. Their action was interpreted as another example of fallout from a decision to cut maintenance of the pipeline and associated facilities.

On 16 October 2007, Alaska Department of Environmental Conservation officials reported a toxic spill of methanol (methyl alcohol) at the Prudhoe Bay oil field managed by BP PLC. Nearly 2,000 gallons of mostly methanol, mixed with some crude oil and water, spilled onto a frozen tundra pond as well as a gravel pad from a pipeline. Methanol, which is poisonous to plants and animals, is used to clear ice from the insides of the Arctic-based pipelines.

2008 Caspian Sea gas leak and blowout

On 17 September 2008, a gas leak was discovered and one gas-injection well blown out in the area of the Central Azeri platform at the Azeri oilfield, a part of the Azeri–Chirag–Guneshli project, in the Azerbaijan sector of Caspian Sea. The platform was shut down and the staff was evacuated. As the Western Azeri Platform was being powered by a cable from the Central Azeri Platform, it was also shut down. According to US Embassy cables, BP had been "exceptionally circumspect in disseminating information" and revealed that BP thought the cause for the blowout was a bad cement job. Production at the Western Azeri Platform resumed on 9 October 2008 and at the Central Azeri Platform in December 2008.

2010 Texas City chemical leak

Two weeks prior to the Deepwater Horizon explosion, BP admitted that malfunctioning equipment lead to the release of over 530,000 lbs of chemicals into the air of Texas City and surrounding areas from 6 April to 16 May. The leak included 17,000 pounds of benzene (a known carcinogen), 37,000 pounds of nitrogen oxides (which contribute to respiratory problems), and 186,000 pounds of carbon monoxide. In June 2012, over 50,000 Texas City residents joined a class-action suit against BP, alleging they got sick in 2010 from the 41-day emissions release from the refinery. Texas has also sued BP over the release of emissions. BP says the release harmed no one.

2010 Deepwater Horizon oil spill

Main articles: Deepwater Horizon oil spill and Deepwater Horizon explosion

Anchor handling tugs combat the fire on the Deepwater Horizon while the United States Coast Guard searches for missing crew

Public protest in New Orleans following the Deepwater Horizon oil spill

On 20 April 2010, the semi-submersible exploratory offshore drilling rig Deepwater Horizon exploded after a blowout; it sank two days later, killing 11 people and causing the largest accidental marine oil spill in the history of the petroleum industry. An estimated 4.9 million barrels of oil was spilled and 1.8 million gallons of Corexit dispersant was applied. This blowout in the Macondo Prospect field in the Gulf of Mexico resulted in a partially capped oil well one mile below the surface of the water. Experts estimate that the gusher flowed at a rate of 35,000 to 60,000 barrels per day (5,600 to 9,500 m³/d) of oil. The exact flow rate was uncertain due to the difficulty of installing measurement devices at that depth and is a matter of ongoing debate. In May 2012, Federal investigators began exploring whether BP representatives lied to Congress regarding the oil flow rate and whether engineers tried to withhold data. The first arrest related to the spill was in April 2012; engineer Kurt Mix was charged with obstruction of justice for allegedly deleting 300 text messages which showed BP knew the flow rate was three times higher than initial claims by the company, and that "Top Kill" was unlikely to succeed, but claimed otherwise.

The resulting oil slick covered at least 2,500 square miles (6,500 km²), fluctuating from day to day depending on weather conditions, threatening the coasts of Louisiana, Mississippi, Alabama, Texas, and Florida.

The drilling rig was owned and operated by Transocean Ltd on behalf of BP, which is the majority owner of the Macondo oil field. At the time of the explosion, there were 126 crew on board; seven were employees of BP and 79 of Transocean. There were also employees of various other companies involved in the drilling operation, including Anadarko, Halliburton and M-I Swaco.

On July 15, 2010, the well was capped, stopping the flow of oil from the riser pipe. Two Relief wells were completed in mid-September 2010.

Beginning in August 2010, oil has been spotted bubbling to the surface near the Macondo site, causing large oil slicks. Edward Overton, professor emeritus at LSU's environmental sciences department, examined oil samples taken from the area in September 2011 and confirmed that the oil came from the Macondo reservoir. The oil is thought by experts to be coming from a seep in the seabed, although there is debate about what caused the seep. Experts believe it may have been caused by the blowout well and subsequent failed attempts to cap it during spring 2010.

In October 2011, a NOAA report stated that dolphins and whales were dying at twice the normal rate. By 2012, at least 749 cetaceans (dolphins and whales) had died. Scientists estimate that for every dead dolphin found there are as many as 50 dead animals that do not make it to Gulf shores. In April 2012, scientists reported finding alarming numbers of mutated crab, shrimp and fish they believed to be the result of chemicals released during the oil spill. In April 2012, oil was found dotting 200 miles of Louisiana's coast.

The US Government named BP the responsible party, and officials committed to hold the company accountable for all clean-up costs and other damage. BP agreed to create a $20 billion spill response fund administered by Kenneth Feinberg. The size of fund was not a cap or a floor on BP's liabilities. In order to fund the payments, BP cut its capital spending budget, sold $10 billion in assets, and dropped its dividend. BP has also been targeted in litigation over the claims process it put in place for victims. A class action lawsuit was filed against BP and its initial claims administrator, the ACE, Ltd. Insurance Group company ESIS.

In March 2012 BP agreed to a $7.8 billion settlement meant as compensation for fishermen, condo owners and others hurt by the oil spill. The money came from the $20 billion escrow. By June 2012, the company had paid out an additional $7.5 billion in compensation and clean-up costs.

Mist mountain project

There have been some calls by environmental groups for BP to halt its "Mist Mountain" Coalbed Methane Project in the Southern Rocky Mountains of British Columbia and for the UN to investigate the mining activities. The proposed 500 km² project is directly adjacent to the Waterton-Glacier International Peace Park.

Canadian oil sands

BP is one of numerous firms who are extracting oil from Canadian oil sands, a process that produces four times as much CO₂ as conventional drilling. The Cree First Nation describe this as 'the biggest environmental crime on the planet'.

Accidents

1965 Sea Gem offshore oil rig disaster

Main article: Sea Gem

In December 1965, Britain's first oil rig, Sea Gem, capsized when two of the legs collapsed during an operation to move it to a new location. The oil rig had been hastily converted in an effort to quickly start drilling operations after the North Sea was opened for exploration. Thirteen crew members were killed. No hydrocarbons were released in the accident.

2005 Texas City Refinery explosion

Main article: Texas City Refinery explosion

In March 2005, BP's Texas City, Texas refinery, one of its largest refineries, exploded causing 15 deaths, injuring 180 people and forcing thousands of nearby residents to remain sheltered in their homes. A 20-foot column filled with hydrocarbon overflowed to form a vapour cloud, which ignited. The explosion caused all the casualties and substantial damage to the rest of the plant. The incident came as the culmination of a series of less serious accidents at the refinery, and the engineering problems were not addressed by the management. Maintenance and safety at the plant had been cut as a cost-saving measure, the responsibility ultimately resting with executives in London.

The fallout from the accident continues to cloud BP's corporate image because of the mismanagement at the plant. There have been several investigations of the disaster, the most recent being that from the US Chemical Safety and Hazard Investigation Board which "offered a scathing assessment of the company." OSHA found "organizational and safety deficiencies at all levels of the BP Corporation" and said management failures could be traced from Texas to London.

The company pleaded guilty to a felony violation of the Clean Air Act, was fined $50 million, and sentenced to three years probation.

On 30 October 2009, the US Occupational Safety and Health Administration (OSHA) fined BP an additional $87 million, the largest fine in OSHA history, for failing to correct safety hazards revealed in the 2005 explosion. Inspectors found 270 safety violations that had been previously cited but not fixed and 439 new violations. BP appealed the fine. (see #Environmental record).

In 2010, BP agreed to pay a settlement of $50.6 million for the safety violations that were not fixed after the explosion. In July 2012, the company agreed to pay $13 million to settle the new violations. At that time OSHA found "no imminent dangers" at the Texas plant, which is up for sale. Thirty violations remain under discussion.

2006–2010: Refinery fatalities and safety violations

From January 2006 to January 2008, three workers were killed at the company's Texas City, Texas refinery in three separate accidents. In July 2006 a worker was crushed between a pipe stack and mechanical lift, in June 2007, a worker was electrocuted, and in January 2008, a worker was killed by a 500-pound piece of metal that came loose under high pressure and hit him.

Facing scrutiny after the Texas City Refinery explosion, two BP-owned refineries in Texas City, and Toledo, were responsible for 97 percent (829 of 851) of wilful safety violations by oil refiners between June 2007 and February 2010, as determined by inspections by the Occupational Safety and Health Administration. Jordan Barab, deputy assistant secretary of labour at OSHA, said "The only thing you can conclude is that BP has a serious, systemic safety problem in their company."

Disclosed US diplomatic cables by WikiLeaks revealed that BP had covered up a gas leak and blowout incident in September 2008 at a gas field under production in the Azeri-Chirag-Guneshi area of the Azerbaijan Caspian Sea. According to the cables, BP was lucky to have been able to evacuate everyone safely given the explosive potential. BP did not only hold back information to the public about the incident but even upset its partner firms in limiting the information shared. In January 2009, BP blamed a bad cement job as the cause for the incident. The Guardian noted a striking resemblance with the later oil spill disaster in the Gulf of Mexico.

2010 Deepwater Horizon well explosion

Main article: Deepwater Horizon explosion

The 20 April 2010 explosion on BP's offshore drilling rig in the Gulf of Mexico resulted in the deaths of 11 people. and injured 16 others; another 99 people survived without serious physical injury. It caused the Deepwater Horizon to burn and sink, and started the largest accidental offshore oil spill in the history of the petroleum industry.

Political record

Colombian pipeline

In July 2006, multi-million pound settlement was agreed between BP and a group of Colombian farmers. An agreed statement said: "The Colombian farmers group are pleased to say that after a mediation process which took place in Bogotá in June 2006 at the joint initiative of the parties, an amicable settlement of the dispute in relation to the Ocensa pipeline has been reached, with no admissions of liability." The company was accused of benefiting from a regime of terror carried out by Colombian government paramilitaries to protect the 450-mile (720 km) Ocensa pipeline; BP insisted throughout that it has acted responsibly and that landowners were fairly compensated .

Release of Lockerbie bomber

BP admitted that it had lobbied the British government to conclude a prisoner-transfer agreement which the Libyan government had wanted to secure the release of Abdelbaset al-Megrahi, the only person convicted for the 1988 Lockerbie bombing over Scotland, which killed 270 people. BP stated that it pressed for the conclusion of prisoner transfer agreement (PTA) amid fears that delays would damage its "commercial interests" and disrupt its £900 million offshore drilling operations in the region, but it denied claims that it had been involved in negotiations concerning the release of Megrahi.

Contributions to political campaigns

According to the Center for Responsive Politics, BP was the United States' hundredth largest donor to political campaigns, having contributed more than US$5 million since 1990, 72% and 28% of which went to Republican and Democratic recipients, respectively.

In February 2002, BP's chief executive, Lord Browne of Madingley, renounced the practice of corporate campaign contributions, noting: "That's why we've decided, as a global policy, that from now on we will make no political contributions from corporate funds anywhere in the world."

During the 2011-2012 election year, Barack Obama received $23,210 in contributions from the oil company, almost twice that of the second largest recipient, Ron Paul.

Lobbying

In 2009 BP spent nearly $16 million lobbying the US Congress. In 2011, BP spent a total of $8,430,000 on lobbying and hired 47 lobbyists.

Market manipulation

In 2004 the US Justice Department charged several BP traders with conspiring to manipulate and corner the propane gas market. In 2005 a federal judge dismissed the indictment against the traders. BP was required to pay approximately $303 million as part of an agreement to defer prosecution.

In November 2010, two US regulators announced plans to investigate BP for allegedly manipulating the gas market. In its 2010 annual report BP elaborated: "The US Federal Energy Regulatory Commission (FERC) and the U.S. Commodity Futures Trading Commission (CFTC) are currently investigating several BP entities regarding trading in the next-day natural gas market at Houston Ship Channel during October and November 2008". The US Commodity Futures Trading Commission also informed BP of intent to recommend charges over the allegations. In a statement, BP said it "did not engage in any inappropriate or unlawful activity" and that it has fully cooperated with the investigations. The company stated it has complied with the law in its trading and transport operations.

See also

• Shell-Mex and BP
• Baku–Tbilisi–Ceyhan pipeline

Further reading

• Ferrier, R.W. (1982). The History of the British Petroleum Company: The Developing Years 1901–1932. Vol. vol. I. Cambridge: Cambridge University Press. ISBN 0-521-24647-4. {{cite book}}: |volume= has extra text (help)
• Bamberg, James H (1994). The History of the British Petroleum Company: The Anglo-Iranian Years, 1928–1954. Vol. vol. II. Cambridge: Cambridge University Press. ISBN 0-521-25950-9. {{cite book}}: |volume= has extra text (help)
• Bamberg, James H (2000). The History of the British Petroleum Company: British Petroleum and Global Oil, 1950–1975: The Challenge of Nationalism. Vol. vol. III. Cambridge: Cambridge University Press. ISBN 0-521-25951-7. {{cite book}}: |volume= has extra text (help)
• Meyer, Karl E (2008). Kingmakers: The Invention of the Modern Middle East. New York: W.W. Norton. ISBN [[Special:BookSources/97803930619944 |97803930619944 [[Category:Articles with invalid ISBNs]]]]. {{cite book}}: Check |isbn= value: invalid character (help); Unknown parameter |coauthors= ignored (|author= suggested) (help)

External links

Official

• Official website
• BP's Corporate History
• Statistical Review of World Energy
• BP's YouTube page

Other

• BP companies grouped at OpenCorporates
• Company details, list of subsidiaries, and major shareholders