By Brian Swint March 2 (Bloomberg) — BP Plc , vying with Royal Dutch Shell Plc as Europe’s largest oil company, plans to increase annual pre-tax profitability by $3 billion over the next two to three years by bolstering production and cutting costs. BP will increase average annual oil and gas output by 1 to 2 percent through 2015, the company said in a annual strategy update today in London. Most of the increased profitability will come from making the refining and marketing business more efficient. The company will centralize exploration and production project management to save money, it said. “The challenge and the opportunity for us is that while our portfolio ranks amongst the best in the industry, our financial performance has yet to fully reflect this,” Chief Executive Officer Tony Hayward said in a statement. “There is now a real opportunity to make our portfolio work harder for us, and we intend to do just that.” BP missed analysts’ earnings estimates in the fourth- quarter as weaker refining margins weighed on profits. BP said it can save an additional $2 billion in its refining and marketing business in the next few years after exceeding cost- cutting targets in 2009. Oil production in 2010 will be “slightly lower” than last year’s output of 4 million barrels a day, Hayward said Feb. 2. BP’s output portfolio is shifting toward natural gas. The company will start 42 new major projects by 2015, which are expected to contribute about 1 million barrels of oil equivalent a day to total production, the company said today. To contact the reporter on this story: Brian Swint in London at bswint@bloomberg.net .
Original post:
BP to Raise Annual Profit $3 Billion by Boosting Production, Cutting Costs
