The Upstream segment is responsible for our activities in oil and natural gas exploration, ﬁeld development and production. We do this through five global technical and operating functions.
The exploration function is responsible for renewing our resource base through access, exploration and appraisal, while the reservoir development function is responsible for the stewardship of our resource portfolio over the life of each field.
The global wells organization and the global projects organization are responsible for the safe, reliable and compliant execution of wells (drilling and completions) and major projects.
The global operations organization is responsible for safe, reliable and compliant operations, including upstream production assets and midstream transportation and processing activities.
Our strategy has three parts and is enabled by:
We want to be the best at what we do – everywhere we work. This starts with executing our activity safely. In every basin, we will benchmark against the competition and aim to be the best – whether it be operating facilities reliably and cost effectively, with a focus on emissions, drilling wells, managing our reservoirs, exploring, building projects, or deploying technology. Through the quality of our execution, scale and infrastructure, we aim to be the low-cost developer and producer in each basin, and as a business, get more from a unit of capital than our competitors.
We will manage our portfolio through disciplined investment in the world’s best oil and gas basins. We plan to grow both oil and gas production. Natural gas is a big lever for reducing greenhouse gas emissions. This means taking a leadership role in tackling the challenge of methane. Around half of our portfolio is currently gas and we expect this to grow as we bring our major projects on line. Our gas portfolio will be complemented by advantaged oil assets – oil we can produce at a higher margin or at a lower cost, creating a portfolio that is resilient whatever the price environment.
We want to grow – but not at any cost. We always look to grow returns and value. We believe this growth will come from many sources – production growth, expanding and managing our margins, operational efficiency, unit cost reduction, and capital efficiency with disciplined levels of capital reinvestment.
In addition to our core Upstream exploration, development and production activities, the segment is responsible for midstream transportation, storage and processing. We also market and trade natural gas, including liqueﬁed natural gas (LNG), power and natural gas liquids (NGL). In 2017 our activities took place in 29 countries.
With the exception of our US Lower 48 onshore business, we deliver our exploration, development and production activities through ﬁve global technical and operating functions.
We optimize and integrate the delivery of these activities across 13 regions, with support provided by global functions in specialist areas of expertise: technology, ﬁnance, procurement and supply chain, human resources, information technology and legal. The US Lower 48 continues to operate as a separate, asset-focused, onshore business. In 2016 we identified a future growth target of 900,000 barrels of oil equivalent per day of production from new projects by 2021 and we remain on track to deliver that. We expect this production to deliver 35% higher operating cash margins on average than our 2015 upstream assets, which supports our value over volume strategy.
We see our scale and long history in many of the great basins in the world as a differentiator for BP and believe in the strength of our incumbent positions. We are resilient and balanced – in terms of geography, hydrocarbon type and geology – and rather than being restricted by a traditional way of working, we have and will continue to use creative business models to generate value. We are also investing to modernize and transform the Upstream – embracing innovation, digitization and the adoption of big data, which we believe can drive a real step change in performance and efficiency.