Latest reports suggest that BP’s shareholders can expect a multibillion-dollar payout this year after the oil giant reported better than expected quarterly profits of almost $2.8bn (£2.2bn) and set out plans to develop a new oil hub in the Gulf of Mexico.
The oil company has angered green groups by giving the go-ahead to develop potential oil resources of 10bn barrels from the new Kaskida project 250 miles south-west of New Orleans, after scaling back its green investments in the last quarter.
At the same time it is expected to raise its dividend payments by 10% while buying back stock worth $1.75bn over the next three months to bring its total buy-backs for the first half of the year to $3.5bn – and $7bn for 2024 as whole.
In total, BP is said to have paid out $14.8bn to shareholders since June 2023, the month that marked the start of the world’s first year-long breach of the 1.5C heating limit, according to an analysis by Global Witness.
Read also: AFDB approves $500 million loan to boost electricity access in Nigeria
Alice Harrison, head of fossil fuel campaigns at the campaign group, said: “While millions of us struggle with high temperatures and high bills, BP are raking in billions of profits, paying out massive dividends, and doubling down on dirty new oil and gas projects.”
The shareholder windfall comes after BP reported better-than-expected profits of $2.76bn for the three months to the end of June, compared with analyst forecasts of $2.54bn for the quarter. The shares rose 2% in early trading on Tuesday.
The company warned investors earlier this month to expect “significantly lower” profit margins from its refining business, which could wipe between $500m and $700m from its earnings for the quarter.
It also told investors it would take a $2bn writedown resulting from a plan to scale back its refining operations at its Gelsenkirchen biofuels refinery in Germany by a third from next year in response to weaker demand.
The chief executive, Murray Auchincloss, said BP was committed to delivering “a simpler, more focused and higher-value company” for shareholders. But the strategy has angered climate campaigner by appearing to scale back its green investments while pushing forward high-value fossil fuel projects.
Story was adapted from the Guardian.
