Release date: 27 November 2019
It’s been a busy few months for one of BP’s top executives, Tufan Erginbilgic.
The Downstream CEO has launched BP Infinia, a recycling technology that has the potential to divert billions of plastic waste items from landfill. In the summer, he oversaw the start of the roll-out of ultra-fast EV charging in the UK and China. And, today, he is fresh from hosting an ‘On The Move’ event in London, where a survey of 12,000 consumers inspired discussion around key mobility themes. Most notably, the rise of electric vehicles (EVs) and barriers to consumer adoption.
The research offered plenty to talk about. “It’s really important that we’re listening and responding to our customers,” Tufan says. “We must enable consumers to choose EVs. That means we need to address their concerns and give them what they want, rather than mandating or imposing solutions on them.”
If these past few months are anything to go by, the next decade is going to be as action-packed, as Tufan and his leadership team define a strategy for growth to 2030 while transforming the business for a low carbon future.
Since taking up the Downstream reins in 2014, the Turkish-born CEO has overseen the delivery of $4 billion of underlying earnings growth, doubling the segment’s earnings potential and putting it well on track for achieving a $6 billion growth target by 2021.
Part of that success lies in BP’s reinvigorated retail strategy and customer focus. Why is it working? “Because we have a differentiated strategy from that of our competitors,” Tufan says.
What’s more, the consumer focus is becoming increasingly connected, with help from huge digital players, such as Google and Microsoft. In practice, that means clever apps for consumers, such as BPme, which streamlines the forecourt experience for drivers looking for ease of payment when they fill their tank.
Significantly, it also gives BP the opportunity to personalize offers and rewards. This is proving successful and, with a global launch now under way, there are more than 34 million customers engaged in BP’s loyalty programme.
The shift to lower carbon energy is reshaping every corner of Tufan’s huge business.
“I think of the energy transition as the evolution of a business over time rather than ‘old versus new’. The biggest prize is to transform the existing businesses to continue to lead in a low carbon future.”
Electrification is transforming the way we get around and BP has a role to play in this area, with BP Chargemaster now powering 1.5 million electric miles a week in the UK following its widespread roll-out of ultra-fast charging points. Meanwhile, in China, the world’s largest EV market, BP joined forces with ride-sharing and transportation platform DiDi to create a nationwide charging network.
“Charging your EV needs to be as convenient if not more so than filling a conventional petrol or diesel vehicle today,” says Tufan. “We’re investing in technology and infrastructure that could bring the time down to less than 10 minutes.
Recognizing, however, that the switch to EVs will be a long-term process, Tufan is encouraging his team to make progress on a range of different fronts. “There are lots of opportunities to help our customers to reduce their emissions in the short and longer term, alongside supporting the roll-out of EVs,” he says.
BP Chargemaster technology being demonstrated at the On The Move event
Those opportunities include developing smarter, lower carbon fuels and re-refined lubricants that help to improve engine efficiency. “Our global team of technologists is working with some of the biggest car manufacturers to create those efficiency gains, so that a conventional internal combustion engine car can use less fuel and emit less carbon dioxide for the same journey.”
And, those BP technologists are using their skills to develop the fuels and lubricants of the future ̶ e-fuels and e-fluids. “If, as a society, we are serious about bringing down transport emissions, we all have to continue to pursue multiple avenues. I strongly believe this is the only way we will make a difference,” Tufan says.
BP sees technology as playing a central role. One example is a BP-backed business with a process for turning household waste into jet fuel that has just 20% of the carbon footprint of its conventional equivalent.
And, in refining, BP had a world first last year with the Lingen refinery using green hydrogen from water electrolysis to meet a portion of its hydrogen demand. In its refinery operations, hydrogen is typically generated from a fossil source. Using green hydrogen produced with renewable energy helps to lower the carbon footprint of our products.
BP is also establishing a leading position in ‘bio co-processing’, a process which takes renewable vegetable oil, or waste oils and fats, together with crude oil feedstock to manufacture high-quality fuels with a lower carbon footprint.
Tufan, centre, visits BP's Texas City Chemicals plant in the US
The focus is not just on fuels and fluids, however. In the petrochemicals business, they are focusing equally on the sustainability strategy.
BP recently announced that it has developed an enhanced recycling technology. 'Infinia' has the capability to take waste plastic, such as black food trays, back to its original monomer state. This means that some unrecyclable plastics, which are currently going to landfill, can be recycled again and again. “BP infinia is game-changing technology,” with the potential to help to bring a solution to one of the world’s biggest challenges: unmanaged plastic waste.
In all areas of Tufan’s Downstream business, finding ways to reduce emissions is now part of many people’s day job. This is helping BP to meet its target to achieve 3.5 million tonnes of sustainable GHG emissions reductions in operations worldwide by 2025.
“With our strategy, technology, partnerships and the capability of our organization, I strongly believe we can transform our business for a low carbon future, still providing the energy needs of our consumers,” says Tufan.
Tufan admits BP forecourts will look different in the future but insists they will still remain relevant
Does that transition daunt him? “Not at all. I know some regard our industry as an obstruction, but I don’t see it that way. Every day, our people are finding new ways to help advance the transition so that we can provide the energy the world needs with fewer emissions. Much of that transition is going to happen in the downstream and I firmly believe that customers will see things changing around them.”
Not least, he says, on the forecourt: “We’re preparing for a new life beyond the internal combustion engine. Does that mean our forecourts will disappear? Absolutely not. Will they look different to today? Absolutely.
“They will change, along with the changing habits and tastes of consumers. But, we’re determined they will remain relevant to people’s lives,” Tufan concludes.
Downstream is the customer-facing arm of BP, employing around 43,000 people, and is made up of three core businesses: fuels, lubricants and petrochemicals and is expanding into new business models through its advanced mobility department.
Under each of these headings are some major operations. Air BP annually supplies 6.5 billion gallons of jet fuel to the aviation industry, BP’s retail network spans 18,700 sites worldwide, and BP capacity across 11 refineries totals 1.89 million barrels per day.