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Why invest in bp

We believe bp has a compelling investor proposition – one that will drive growing long-term shareholder value – and to do this we are focused on transforming from an international oil company (IOC) to an integrated energy company (IEC) while remaining committed to performing as we transform. And we believe we can generate attractive returns in doing so.
 

Change of this scale isn’t straight-forward, but we believe offers significant opportunity, and this page explains our proposition to investors. Please also refer to our Legal notice

Performing while transforming

from IOC to IEC

 

What we offer

We believe bp has a compelling investor proposition that combines:

  • Committed distributions - generating competitive cash returns now as we transform
  • Profitable growth – growing EBIDA per share and growing returns; and
  • Sustainable value - as we invest with discipline in our five transition growth engines - and lower our emissions.

 

All in service of delivering long-term shareholder value.

The need for an IEC 

We are leaning further into our strategy:

  • The world has changed since we laid out our strategy in 2020 – the world wants and needs a better and more balanced energy system – one that can deliver more secure, more affordable as well as lower-carbon energy solutions – the so called ‘energy trilemma’
  • To deliver that better energy system, action is needed:
    • To accelerate the energy transition, 
      And
    • Ensure an orderly transition of today’s predominantly hydrocarbons-based energy system  
  • This means both:
    • Increased investment in lower-carbon solutions that can help society decarbonise faster.
      And – not or
    • Continued investment in hydrocarbons to keep energy flowing, with energy security and affordability at a premium.
  • Our track record of delivery has given us increased confidence in the strategy we laid out
  • An IEC is uniquely set up to deliver energy security and affordability today – as well as to help accelerate the energy transition
  • And crucially – we believe we can generate growth and attractive returns in doing so
  • It is for these reasons that we see the opportunity to lean further into our strategy

 

How we are doing it

Focused on creating value and driving returns in three strategic focus areas

  • Delivering resilient hydrocarbons to provide energy security today
  • While at the same time, investing at scale in our five transition growth engines to accelerate the energy system of the future
Growing EBITDA to 2030
Image showing how bp is advancing our strategy at pace – growing EBITDA to 2030

Optimized through our integrated energy model

  • Binding together our three strategic focus areas is integration
  • We believe we are one of a few companies who have the scale, global presence and expertise to navigate complex markets and who can help manage increasingly interconnected energy systems
  • And we have our world-class trading organisation to optimise the flow of energy, which has contributed an average uplift to group ROACE of 4% over 2020 to 2022

Integration in action

 

  • We are moving into renewables, both solar and wind, generating electrons – a new upstream business
  • We can transform these electrons into hydrogen – a new downstream business
  • And we will sell the products – electrons and hydrogen – to customers – a new marketing business
  • This creates an electron and hydrogen energy value chain with upstream, downstream and marketing businesses, that complement our existing hydrocarbon value chain
  • This is just one of many integration opportunities across our businesses

Decarbonizing our company

Embedded across our strategic focus areas is our sustainability frame, which sets out our aim for getting to net zero in operations, production and sales by 2050 or sooner.

E m b e d d i n g i n t o o u r D N A E n g a g i n g s t a k e h o l d e r s I m p ro v e p e op l e ' s l i v e s G e t t o n e t z e ro C a r e f o r o u r p l a n e t Our beliefs and foundations

Why we are confident

The energy transition presents clear and compelling growth opportunities

Investing in five transition growth engines

Bioenergy
Farming machinery for bioenergy
We have established, global biogas and biofuel businesses that are positioned in an increasingly supportive environment of rapidly growing demand, with attractive fiscal incentives. We plan to increase biogas supply volumes to around 70 mboed by 2030. The acquisition of Archaea Energy has been a real game changer for us – rapidly advancing our access to feedstock and scaling our upstream participation in the biogas value chain. In biofuels, we aim to materially grow biofuel production volumes to around 100 thousand barrels per day by 2030, focused on sustainable aviation fuel, where we aim to be a sector leader.  We already produce more than seven thousand barrels per day of biofuels through co-processing, and we also plan to deliver five biofuel projects at our Kwinana, Rotterdam, Castellon, Lingen, and Cherry Point facilities.
Convenience
Happy customers in a shop
Through our focus on customers, we aim to grow convenience gross margin at around 10% per annum by 2030 from 2022. This is supported by the expansion of our strategic convenience network to around 3,500 sites by 2030.
Electric vehicle charging
An image of an electric vehicle being charged
We are accelerating our EV charging ambition across key growth markets, through a focus on 'on-the-go' fast charging and fleets. This is supported by our aim to grow our network to more than 100,000 EV charge points by 2030, with around 90% of these rapid or ultra fast.
Hydrogen
An image of a hydrogen plant
Our ambition is to build a leading position globally. We plan to use our refineries as demand anchors for hydrogen, and to scale these up to regional hubs. As markets evolve, we expect to invest to build global export hubs for hydrogen and hydrogen derivatives. These are in advantaged geographies where we have an established presence. By 2030, we aim to produce between 0.5 and 0.7 mtpa of primarily green hydrogen, while selectively pursuing blue hydrogen opportunities where there is regulatory support and CCS access
Renewables & Power
Solar panels in a field
Focusing our investment on opportunities where we can create integration value, and enhance returns. We are building a renewables portfolio in service of green hydrogen, green and e-fuels, EV charging and power trading (including low carbon flexible generation). As part of this we are building a global position in offshore wind. We also continue to progress a solar development and sell model with Lightsourcebp, which is self-funding and capable of delivering renewable power rapidly, at scale. We aim to deliver our 50 GW net developed to FID by 2030, including ~10 GW net installed capacity.

Aim to deliver $10-12bn EBITDA by 2030 from transition growth engines

bp transition growth engines returns and EBITDA

Leveraging our advantaged high-quality oil and gas portfolio

Chirag Patform, Caspian Sea, Photo: Stuart Conway/ BP
  • Expect oil and gas to remain an integral part of the energy system for decades to come
  • Strategy focused on value, not volume – maximising returns and cash flow, reducing emissions
  • Underpinned by deep and high-quality resource base of 18bn boe in plan
  • Plan to grow underlying production to 2025:
    • Adding ~200mboed of high margin production from nine major project start-ups
    • >30% increase in LNG supply to around 25mtpa
    • Continuing to manage base decline between 3-5%
    • Increasing bpx production by 30-40%
    • And retaining some assets for longer than previously planned
  • Potential to sustain underlying production broadly flat to 2030 relative to 2022
  • Remain focused on high-grading our portfolio and plan to divest around 200mboed of lower margin assets by 2030
  • To maximise value we intend to:
    • Maintain investment discipline with hurdle rates of 15-20% at $60/bbl
    • Maintain a balanced portfolio with a broadly equal mix across oil and gas
    • Drive capital productivity
    • Sustain cost efficiency and reliability improvements in our operations

How we are delivering

Our strategy is underpinned by a disciplined financial frame with five clear priorities

bp financial frame

bp financial frame

We are making good progress delivering on our strategy

Real strategic momentum in our transformation

Strengthening our balance sheet

Delivering long-term value for our shareholders

Performing while transforming – 2023 at a glance

Adjusted EBITDA

$43.7bn

 

Operating cash flow

$32.0bn

 

includes working capital release of $2.8bn

ROACE

18.1%

Net debt

$20.9bn

 

 

Dividend per share

$7.270

 

+10% vs 4Q22

Share buybacks

$6.5bn

 

announced from 2023 surplus cash flow

Summary of our investor proposition

Growing value and returns

  • >12% adjusted EBIDA per share CAGR from 2H19/1H20 to 2025 (at $70/bbl 2021 real)
  • Growing ROACE to >18% by 2025 (at $70/bbl 2021 real)

Compelling cash distributions

  • Resilient dividend, ~ 4% p.a. growth (at $60/bbl)

Investing in transition: driving down emissions

  • Net zero by 2050 or sooner across operations, production and sales