BP continues to pull away from the financial liabilities of the Deepwater Horizon disaster, although the oil giant’s fourth quarter profits fell short of what analysts and investors had hoped for.
The company posted underlying replacement cost profits – a common measurement that allows for fluctuations in oil prices – of $400m (£320m) for its fourth quarter, and full-year profits of $2.6bn.
The $400m was less than the $560m expected by analysts but represents a increase from the $196m reported this time last year.
Excluding a $4.1bn legacy charge from the Gulf of Mexico oil spill, BP’s reported headline profit for the full year was $115m, up from a $6.5bn loss in 2015.
“2016 was the year we made significant strides in creating a stronger platform for growth,” said chief executive Bob Dudley.
We launched six major project start-ups – from Algeria to the Gulf of Mexico – and made final investment decisions on a further five major projects. And we see exciting opportunities ahead.
Last month the oil giant began the Thunder Horse expansion project, one of its first major projects in the Gulf of Mexico since the Deepwater Horizon disaster, almost a year ahead of schedule and $150m under budget.
It marked the first of eight new global production projects that are expected to start pumping oil this year. Combined, they could boost the oil company’s revenue by around $4.5bn to $5bn by the end of the decade even if prices remain at $50 a barrel, according to Barclays Capital.
“With our Deepwater Horizon financial liabilities now substantially behind us, BP is fully focused on the future,” Mr Dudley added. “You have seen that focus in the string of strategic portfolio additions during the last two months of the year.”