BP 2012 Annual Report Download - page 19

We aim to protect value by maintaining a
rigorous focus on safety, reliability and
efficiency across our range of activities. We
often work with partners to mitigate risk or gain
from complementary skills.
Finding oil and gas
First, we acquire the rights to explore for oil
and gas. Through new access we are able to
renew our portfolio, discover new resources
and replenish our development options.
Developing and extracting oil and gas
When we are successful in finding hydrocarbon
resources, we create value by seeking to
progress them into proved reserves or by
selling them on if they do not fit with our
strategic objectives.
If we believe developing and producing the
reserves will be advantageous for BP, we will
produce the oil and gas, then sell it to the
market or distribute it to our downstream
facilities.
Transporting and trading oil and gas
We move oil and gas through pipelines and
by ship, truck and rail. We use our trading
and supply skills and knowledge to find the
best routes to deliver supplies to the most
attractive markets.
Manufacturing and marketing fuels
and products
Using our technology and expertise, we
manufacture fuels and products, creating value
by seeking to operate a high-quality portfolio of
well-located assets safely, reliably and efficiently.
We market our products to consumers and other
end-users and add value through the strength of
our brands.
Our distinctive strengths
and capabilities
We consider our areas of distinctive strength to
include:
t Exploration – acquiring access and searching
for hydrocarbons.
t Deep water – we have a long track record
in finding, developing and producing
hydrocarbons in deep water.
t Giant fields – managing the scale and
complexity of fields with resources believed to
exceed 500 million boe.a
t Gas value chains – seeking to add value as
gas moves from field to customer.
t Downstream – the pursuit of safe, reliable and
efficient operations, and leading returns, across
fuels, lubricants and petrochemicals.
These are underpinned by our development
and application of technology and our ability
to build strong relationships. In addition, we
have a long-established integrated supply
and trading function.
Strong relationships
We are seeing an evolution in our industry,
with international oil companies such as BP
establishing new kinds of partnerships and
co-operation with governments, national oil
companies and other resource holders. The
benefits of our value-creating activity are
shared with governments and other partners.
We seek opportunities to develop and deploy
distinctive capabilities that complement those
of our partners. We also partner with universities
and governments in pursuit of improving the
technologies available to us, so we can enhance
our operations and develop new products. We
aim to support and improve standards in our
Our business model
For more information see BP at a glance
on pages 4-5.
a Actual amount of proved reserves of such fields on
a basis recognized by the SEC may be less than this.
Salt reduction promises
healthy returns
Typically, less than 35% of the oil in a field
is extracted, even when wells are flooded
with water to increase recovery. That means
important resources are currently left
untapped, all over the world.
The LoSal flooding process is set to
significantly improve recovery rates.
Developed at BP’s UK research centre, the
LoSal flooding process uses water with
a low salt content, which releases more
molecules of oil from the sandstone rock
in which they are held.
Following a successful trial in the Endicott
field in Alaska, we are applying LoSal where
appropriate in our portfolio. In 2012 Clair Ridge
in the North Sea became the first large-scale
offshore scheme to deploy the technology.
BP estimates that this breakthrough
technology (part of BP’s suite of Designer
Water enhanced oil recovery technologies) will
increase production by around 42 million
barrels of additional oil, compared with
conventional water flooding methods.
Business review: Group overview
BP Annual Report and Form 20-F 2012
Business review: Group overview
17