Annual report
An overview of BP’s key activities, events and results in 2019, together with commentary on our performance and ambition as we move forward.
Helge Lund, chairman
Bernard Looney, chief executive officer
Global context
Many forces and trends are fundamentally changing the business environment, creating uncertainties and influencing the way we do business. We monitor these trends closely and explore the forces shaping the global energy transition.
Megatrends
The exact pace and nature of the energy transition is unclear, but it is clear that the market for our products is changing. Megatrends affecting our industry include:
- Growing global concern over climate change
- Rapidly advancing digital technology, affecting all aspects of economic activity
- Increasing prosperity in the emerging world driving economic growth
- Changing societal expectations of corporations
- Shifting geopolitical trends as trade, economies and relationships change over time
Growing global concern over climate change is a key driving force among these trends. The way the world responds to this, and the resulting impact on the energy sector is the most significant uncertainty we face.
BP Energy Outlook 2019
Our outlook explores the forces shaping the global energy transition out to 2040 and the key uncertainties surrounding it. The 2019 outlook considers a range of scenarios. They have some common features, such as ongoing economic growth and a shift towards a lower carbon fuel mix, but differ in terms of policy, technology and behavioural assumptions.
Scenarios
- Evolving transition: assumes that government policies, technology and social preferences continue to evolve in a manner and speed seen over the recent past.
- Rapid transition: envisages a more rapid transition to a lower carbon energy system, through a reduction in emissions stemming from greater energy efficiency, fuel switching and use of carbon capture, use and storage (CCUS).
The key dimensions of the energy transition
To meet the Paris goals we believe the world must take strong action on a range of fronts.
Improving energy efficiency, to decouple energy demand from growing economic activity and prosperity.
Rapid growth in renewable energy and other low or zero carbon energy sources.
Increasing the share of electricity in final energy use and decarbonizing power generation.
Switching to lower or zero carbon liquid and gaseous fuels, particularly in areas such as heavy transport.
Deploying carbon-removal technologies, such as CCUS at scale.
Promoting natural climate solutions including the management and restoration of habitats, and the role of carbon credits.
The pace at which the transition can be achieved and the precise mix of elements is uncertain.
There are many possible pathways to meeting the Paris goals and we use different scenarios to explore this uncertainty. When we evaluate the consistency of our new material capex investments with the Paris goals, we consider a range of different possible pathways and scenarios.
Our business model
We deliver a diverse range of energy products and services to people around the world.
Segment performance
Case studies from 2019
Examples of our strategy in action throughout the year.
From electrifying China to using gas to create sustainable fish food– find out about our progress across the world in 2019.
Key downloads
Our key reports include information about our financial and operating performance, sustainability performance and also global energy trends and projections.
This document constitutes the Annual Report and Accounts in accordance with UK requirements and the Annual Report on Form 20-F in accordance with the US Securities Exchange Act of 1934, for BP p.l.c. for the year ended 31 December 2019. A cross reference to Form 20-F requirements is included on page 348 of the Annual Report.
This document contains the Strategic report on the inside front cover and pages 1-71 and the Directors' report on pages 72-99, 101 (in part only), 128-129, 232-259 and 297-346. The Strategic report and the Directors' report together include the management report required by DTR 4.1 of the UK Financial Conduct Authority's Disclosure Guidance and Transparency Rules. The Directors' remuneration report is on pages 100-127. The consolidated financial statements of the group are on pages 131-231 and the corresponding reports of the auditor are on pages 132-151. The parent company financial statements of BP p.l.c. are on pages 260-296.
The Directors' statements (comprising the Statement of directors' responsibilities; Risk management and internal control; Longer-term viability; Going concern; and Fair, balanced and understandable), the independent auditor's report on the annual report and accounts to the members of BP p.l.c., the parent company financial statements of BP p.l.c. and corresponding auditor's report and a non-GAAP measure of operating cash flow excluding Gulf of Mexico oil spill payments in the tables on pages 35, 36 and 37 do not form part of BP's Annual Report on Form 20-F as filed with the SEC.
BP Annual Report and Form 20-F 2019 may be downloaded from bp.com/annualreport. To obtain a hard printed copy of BP's complete audited financial statements, free of charge, UK based investors should contact BP Distribution Services by clicking the link above or calling +44 (0)870 241 3269 or by emailing bpdistributionservices@bp.com. If based in the US or Canada investors should contact Issuer Direct by calling +1 888 301 2505 or by emailing bpreports@issuerdirect.com.
BP p.l.c. is the parent company of the BP group of companies. The company was incorporated in 1909 in England and Wales and changed its name to BP p.l.c. in 2001. Where we refer to the company, we mean BP p.l.c.. The company and each of its subsidiaries are separate legal entities. Unless otherwise stated or the context otherwise requires, the term “BP” and terms such as “we”, “us” and “our” are used in this report for convenience to refer to one or more of the members of the BP group instead of identifying a particular entity or entities. Information in this document reflects 100% of the assets and operations of the company and its subsidiaries that were consolidated at the date or for the periods indicated, including non-controlling interests.
The company’s primary share listing is the London Stock Exchange. In the US, the company’s securities are traded on the New York Stock Exchange (NYSE) in the form of ADSs (see page 328 for more details) and in Germany in the form of a global depositary certificate representing BP ordinary shares traded on the Frankfurt, Hamburg and Dusseldorf Stock Exchanges.
The term `shareholder' in this report means, unless the context otherwise requires, investors in the equity capital of BP p.l.c., both direct and indirect. As the company’s shares, in the form of ADSs, are listed on the NYSE, an Annual Report on Form 20-F is filed with the SEC. Ordinary shares are ordinary fully paid shares in BP p.l.c. of 25 cents each. Preference shares are cumulative first preference shares and cumulative second preference shares in BP p.l.c. of £1 each.
The Material may contain certain forward-looking statements, forecasts or projections with respect to the financial condition, results of operations and businesses of BP and certain of the plans and objectives of BP with respect to these items. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that will or may occur in the future. Actual results may differ materially from those expressed in such statements depending on a variety of factors.
Please refer to the Cautionary statement on page 324 of the full BP Annual Report and Form 20-F 2019 for further information on forward-looking statements.