BP reports worst annual loss in 20 years

MOSCOW (MRC) -- Oil giant BP reported its worst annual loss in 20 years and further restructuring charges as low oil prices continue to weigh on the company, said Cnbc.

For 2015 as a whole, the company reported a loss of USD6.5 billion. The stock opened down over 5 percent in London trade. On an underlying basis, fourth quarter replacement cost profit came in at USD196 million, well below expectations of USD730 million in a poll of analysts provided by the company, and down from USD2.2 billion a year earlier.

Replacement cost profit is a common accounting measure to report profits in the oil industry which takes into account the fluctuations in the price of oil. Oil prices are wallowing around a 12-year low of around USD33 a barrel for benchmark Brent crude as demand fails to keep pace with a glut in global supply.

BP took USD2.6 billion in non-operating post-tax charges in the fourth quarter, primarily related to impairments of upstream assets as well as restructuring charges for the group. Including these charges and other offsetting effects, BP reported a replacement cost loss for the fourth quarter of 2015 of USD2.2 billion.

Cumulative restructuring charges from the beginning of the fourth quarter 2014 totaled USD1.5 billion by the end of 2015. A further USD1.0 billion of restructuring charges are expected to be incurred in 2016, the group said.

As MRC informed earlier, BP PLC is selling its petrochemical complex in Decatur, Alabama, to Indorama Ventures Public Co. Ltd. (IVL.TH), for an undisclosed sum, as part BP's plan to restructure its global petrochemicals business.

BP is a leading producer of oil and gas and produces enough energy annually to light nearly the entire country for a year. Employing about 17,000 people across the country, BP supports more than 170,000 additional jobs through all of its business activities.
MRC

Borealis receives two European plastics innovation awards for energy and automotive projects

MOSCOW (MRC) -- Borealis, a leading provider of innovative solutions in the fields of polyolefins, base chemicals and fertilizers, has received two European Plastics Innovation Awards, said the producer in its press release.

Thus, they are:

- The New Surfaces for Plastic Parts Award for the Daplen EE112AE lightweight primerless paintable thermoplastic olefin (TPO) compound;
- The Best Lightweight Innovation Award for their cooperation with film manufacturer, Treofan, in creating the thinnest polypropylene capacitor film yet.

In 2015, European Plastics Converters (EuPC), PlasticsEurope and the Society of Plastics Engineers (SPE) launched their European Innovation Awards competition to acknowledge the work of companies in the plastics industry value chain that have developed a new idea, method, product or technology that responds to a societal need while respecting the three Ps of Sustainability (People, Planet, Profit).

The automotive industry has an increasing need for greater economy and efficiency in automotive exterior applications by reducing cycle time and system costs, while still meeting high production standards. Primerless painting systems can help achieve these parameters by eliminating a step in the production process. The New Surfaces for Plastic Parts Award was presented to Borealis for the primerless paint grade Daplen EE112AE, a 12% mineral-filled elastomer modified polypropylene (PP) compound, which was developed in close partnership with BMW for use in its top vehicle range and fulfils BMW's stringent paint adhesion quality requirements for primerless paint systems. It provides easy processability for low production scrap rate and reduced density with good impact/stiffness balance enabling the weight reduction of parts. This material was used in the BMW 7 front bumper and tailgate cladding.

For the Best Lightweight Innovation Award, Borealis was recognised together with Treofan, a global leader in biaxially oriented polypropylene (BOPP) films, for their cooperation in creating the thinnest polypropylene capacitor film, down to 1.9 µm. This film was made with Borclean HC310BF, a high crystallinity, super pure homo-polypropylene with a novel molecular design that enables the production of ultra-thin, metallisable dielectrical film for dry capacitors with increased thermal stability.

Polypropylene capacitor films are used in the production of dry, metalized capacitors for a variety of applications, but specifically in automotive applications for hybrid and electric motor systems, there is a need for high thermal stability and low volume in order to save space and reduce costs for the cooling systems. Thus, extremely thin films with a high level of thermal and electrical resistance are needed.

As MRC reported earlier, in June 2015, Borealis announced progress made to date on the start-up of the third phase expansion of its Borouge joint venture with Abu Dhabi National Oil Co. in Ruwais, Abu Dhabi. By the end of 2014, the 1.5-million-t/y ethylene cracker, as well as three of the five polyolefin plants had started production. During the first quarter of this year, Borouge continued this process with the start-up of its high-pressure polyethylene plant. The Borouge 3 expansion includes two Borstar enhanced PE plants with a combined capacity of 1.08-million t/y, a 350,000-t/y low-density PE plant and two Borstar enhanced polypropylene facilities having a total capacity of 960,000 t/y.

Borealis is a leading provider of innovative solutions in the fields of polyolefins, base chemicals and fertilizers. With headquarters in Vienna, Austria, Borealis currently employs around 6,500 and operates in over 120 countries. It generated EUR 8.3 billion in sales revenue in 2014.
MRC

BP announces 3,000 downstream job cuts after historic annual losses

MOSCOW (MRC) --BP slumped to its biggest annual loss last year and announced thousands more job cuts on Tuesday, showing that even one of the nimblest oil producers is struggling in the worst market downturn in over a decade, as per Reuters.

The British oil and gas company, which is still grappling with about USD55 billion of costs from the oil spill in the Gulf of Mexico in 2010, said it would cut 7,000 jobs by the end of 2017, or nearly 9% of its workforce.

BP said it lost USD6.5 billion in 2015 and its fourth-quarter underlying replacement cost profit, which is the company's definition of net income, came in at USD196 million, well below analyst expectations of USD730 million.

BP shares fell as much as 8.5% and were 8.1% lower at 1136 GMT, the worst performer on the pan-European FTSEurofirst 300 index and on track for their biggest one-day fall since June 2010.

The company's 2015 loss shows that even its "shrink to grow" strategy adopted after the Macondo rig explosion in 2010, hailed as the best preparation for a weak oil market, was unable to buffer the impact of the lowest oil prices since 2003.

BP's results are the latest to show the extent large oil companies are struggling following a 70% slide in oil prices since the middle of 2014 that has forced them to cut tens of thousands of jobs and slash spending.

BP's 2015 annual loss was bigger than the overall loss of USD4.9 billion it reported in 2010, even though it took a USD17.2 billion hit in the second quarter of that year after the explosion in the Gulf of Mexico.

BP said if the current downturn persists for longer than anticipated, it would be able to reduce its costs further to allow its balance sheet to break even below USD60/bbl.

"Should current conditions persist for longer than anticipated, we expect that all the actions we are taking will capture more deflation," chief financial officer Brian Gilvary said in a statement.

BP reduced operating costs by USD3.5 billion last year and said it expected savings to reach USD7 billion by 2017.

It plans to cut 3,000 jobs in its downstream division by the end of 2017, on top of 4,000 cuts in its oil and gas production business announced last year.

"We are continuing to move rapidly to adapt and rebalance BP for the changing environment," CEO Bob Dudley said in a statement.

Despite lower revenue from oil production, BP's output rose 5.4% to 2.26 million bpd of oil equivalent.

We remind that, as MRC reported earlier, in 2015, BP Zhuhai Chemical Co Ltd started a new purified terephthalic acid (PTA). Located in Zhuhai, China, the plant has a production capacity of 1.25 million mt/year.

BP is one of the world's leading international oil and gas companies, providing its customers with fuel for transportation, energy for heat and light, retail services and petrochemicals products for everyday items.
MRC

LyondellBasell Q4 profit tops estimates

MOSCOW (MRC) -- LyondellBasell, one of the world's largest plastics, chemical and refining companies, has reported earnings from continuing operations for the fourth quarter of USD797 million, or USD1.78 per share, as per the company's report.

Excluding the LCM adjustment, earnings from continuing operations during the fourth quarter totaled USD982 million, or USD2.20 per share. For the fourth-quarter of prior year, income from continuing operations was USD796 million or USD1.57 per share.

On average, 20 analysts polled by Thomson Reuters expected the company to report profit per share of USD2.14 for the quarter. Analysts' estimates typically exclude special items.

Sales and other operating revenues decreased year-over-year to USD7.07 billion from USD10.29 billion, last year. Analysts expected revenue of USD7.60 billion for the quarter.

As MRC reported earlier, LyondellBasell announced that its Supervisory Board had authorized the company's Management Board to declare an interim dividend of USD0.78 per share. The interim dividend will be paid March 14, 2016 to shareholders of record February 29, 2016 with an ex-dividend date of February 25, 2016.

LyondellBasell is one of the worldпїЅs largest plastics, chemical and refining companies and a member of the S&P 500. LyondellBasell manufactures products at 56 sites in 19 countries. LyondellBasell products and technologies are used to make items that improve the quality of life for people around the world including packaging, electronics, automotive parts, home furnishings, construction materials and biofuels.
MRC

Exxon Mobil quarterly profits drop 58%

MOSCOW (MRC) -- US oil giant Exxon Mobil decreased its profits fell 58% to USD2.78bn (GBP1.93bn) in the three months to the end of December, compared with USD6.57bn for the same period a year earlier, said the company on its site.

It saw annual profits halve to USD16.2bn, from USD32.5bn in 2014. Exxon Mobil's results come after rivals Chevron and BP both reported large losses for the fourth quarter.

Oil prices fell sharply on Tuesday, with Brent crude down 5.3% to USD32.42. Crude oil prices have dropped about 70% from the 2014 high of more than $100 a barrel.

Oil companies have been trying to cut costs and investments in new projects as they adjust to the sustained fall in prices. Exxon says its capital spending will be about USD23.2bn in 2016, a cut of 25% compared with 2015.

Upstream earnings, which means exploration and production, slumped to USD857m in the fourth quarter compared with USD4.6bn during the same time last year.

Lower commodity prices in the upstream section of the business were partly offset by higher downstream earnings.
Downstream earnings, which mean refined oil products, were USD1.4bn, up USD854m from the fourth quarter of 2014.

As MRC informed earlier, ExxonMobil is studying a proposal to expand its 334,600-bpd refinery in Beaumont, Texas, into the largest in the US. ExxonMobil has pulled together a group of experts at the plant to do more detailed studies on potentially adding a third crude distillation unit (CDU). The new CDU could make the Beaumont refinery the largest in the US, with capacity rising to as much as 850,000 bpd.

ExxonMobil is the largest non-government owned company in the energy industry and produces about 3% of the world's oil and about 2% of the world's energy.
MRC