Shares digital

In the first update on strategy since Tony Hayward took over as CEO, BP (BP.) says it can continue to pump at least four million barrels of oil a day until 2020 – even without new discoveries.

Hayward notes that since taking over he and his senior team have conducted one of the widest ranging reviews in the company’s recent history. This self-help programme is on track to deliver significant new upstream volume additions, around 650,000 barrels a day to be added between 2007 and 2009, and a major restructuring of the downstream segment which has drastically underperformed its peers since 2003.

The company’s reserves replenishment rate, a comparison between the level of new recoverable reserves booked with the amount of oil being pumped, was revealed to be 112% which is expected to compare favourably with Royal Dutch Shell’s (RDSB) performance in this area. It will announce its own figure later this month.

Shares says: As the restructuring programme begins to take hold BP should reverse its recent underperformance relative to Shell.

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by: Tom Sieber