BP 2012 Annual Report Download - page 67

Business review: BP in more depth
Business review: BP in more depth
BP Annual Report and Form 20-F 2012
65
The recordable injury frequency (RIF), which measures the number of
recordable injuries to the BP workforce per 200,000 hours worked, was
0.32. This is higher than 2011 when it was 0.30 and equal to 2010 when it
was also 0.32. The 2012 DAFWCF, a subset of the RIF that measures the
number of cases where an employee misses one or more days from work
per 200,000 hours worked, was 0.053. This is lower than 2011 when it
was 0.060 and 2010 when it was 0.063.
In 2012 the number of reported loss of primary containment (LOPC)
incidents in Upstream was 151, down from 152 in 2011. The number
of reported oil spills equal to or larger than 1 barrel during 2012 was
87, up from 71 in 2011.
Financial and operating performance
$ million
2012 2011 2010
Sales and other operating revenuesa 71,940 75,475 66,266
Replacement cost profit before
interest and tax 22,474 26,366 28,269
Net (favourable) unfavourable impact
of non-operating items and fair
value accounting effectsb(3,055) (1,141) (3,196)
Underlying replacement cost profit
before interest and taxc19,419 25,225 25,073
Capital expenditure and acquisitions 17,859 25,535 17,753
BP average realizationsd$ per barrel
Crude oil 108.94 107.91 77.54
Natural gas liquids 42.75 51.18 42.78
Liquidse102.10 101.29 73.41
$ per thousand cubic feet
Natural gas 4.75 4.69 3.97
US natural gas 2.32 3.34 3.88
$ per thousand barrels of oil equivalent
Total hydrocarbonsf61.86 62.31 47.90
Production (net of royalties)g
Liquidsethousand barrels per day
Subsidiaries 896 992 1,228
Equity-accounted entities 284 294 289
Total of subsidiaries and equity-
accounted entities 1,179 1,285 1,517
Natural gas million cubic feet per day
Subsidiaries 6,193 6,393 7,332
Equity-accounted entities 416 415 429
Total of subsidiaries and equity-
accounted entities 6,609 6,807 7,761
Total hydrocarbonsfthousand barrels of oil equivalent per day
Subsidiaries 1,963 2,094 2,492
Equity-accounted entities 355 366 363
Total of subsidiaries and equity-
accounted entities 2,319 2,460 2,855
$ million
2012 2011 2010
Estimated net proved reserves
(net of royalties)
Liquidshmillion barrels
Subsidiariesi4,477 5,154 5,558
Equity-accounted entitiesj838 929 1,221
Equity-accounted entities
(bitumen)j195 178 179
Total of subsidiaries and equity-
accounted entities 5,510 6,261 6,958
Natural gas billion cubic feet
Subsidiariesk 33,264 36,380 37,809
Equity-accounted entitiesj2,549 2,397 2,532
Total of subsidiaries and equity-
accounted entities 35,813 38,777 40,341
Total hydrocarbons million barrels of oil equivalent
Subsidiaries 10,213 11,426 12,077
Equity-accounted entities 1,472 1,520 1,837
Total of subsidiaries and equity-
accounted entities 11,685 12,946 13,914
h Liquids comprise crude oil, condensate, NGLs and bitumen.
i Includes 14 million barrels (20 million barrels at 31 December 2011 and 22 million barrels at
31 December 2010) in respect of the 30% minority interest in BP Trinidad and Tobago LLC.
j During 2012, upstream operations in Abu Dhabi, Argentina and Bolivia, as well as some of our
operations in Angola, Canada, Indonesia and Trinidad, were conducted through equity-accounted
entities.
k Includes 2,890 billion cubic feet of natural gas (2,759 billion cubic feet at 31 December 2011 and
2,921 billion cubic feet at 31 December 2010) in respect of the 30% minority interest in BP
Trinidad and Tobago LLC.
Sales and other operating revenues for 2012 were $72 billion, compared
with $75 billion in 2011 and $66 billion in 2010. The decrease in 2012,
compared with 2011, primarily reflected lower production and persistently
low Henry Hub gas prices. The increase in 2011, compared with 2010,
primarily reflected higher oil and gas realizations, partly offset by lower
production.
The replacement cost profit before interest and tax for 2012 was
$22,474 million, compared with $26,366 million for the previous year.
This included net non-operating gains of $3,189 million, primarily a result
of gains on disposals being partly offset by impairment charges. (See
page 37 for further information on non-operating items.) In addition, fair
value accounting effects had an unfavourable impact of $134 million
relative to management’s measure of performance. (See page 37 for
further information on fair value accounting effects.)
After adjusting for non-operating items and fair value accounting effects,
the underlying replacement cost profit in 2012 was $19,419 million,
compared with $25,225 million in 2011. The 23% decrease was due to
higher costs (primarily higher depreciation, depletion and amortization, as
well as ongoing sector inflation), lower production and lower realizations.
Total capital expenditure including acquisitions and asset exchanges in
2012 was $17.9 billion (2011 $25.5 billion and 2010 $17.8 billion). (See
page 66 for further information on acquisitions.)
Provisions for decommissioning increased from $17.2 billion at the end
of 2011 to $17.3 billion at the end of 2012. The increase reflects updated
estimates of the cost of future decommissioning and additions for new
assets, largely offset by transfers to assets held for sale and divestments.
Decommissioning costs are initially capitalized within fixed assets and are
subsequently depreciated as part of the asset.
a Includes sales between businesses.
b Fair value accounting effects represent the (favourable) unfavourable impact relative to
management’s measure of performance (see page 37 for further details).
c Underlying replacement cost profit is not a recognized GAAP measure. See footnote b on
page 34 for information on underlying replacement cost profit.
d Realizations are based on sales of consolidated subsidiaries only, which excludes equity-
accounted entities.
e Liquids comprise crude oil, condensate and natural gas liquids (NGLs).
f Expressed in thousands of barrels of oil equivalent per day (mboe/d). Natural gas is converted to
oil equivalent at 5.8 billion cubic feet = 1 million barrels.
g Includes BP’s share of production of equity-accounted entities in the Upstream segment.
Because of rounding, some totals may not agree exactly with the sum of their component parts.