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BP hit by loss in wake of oil spill

Feb 01 2011 10:28
London - BP on Tuesday posted a loss of $4.914bn for 2010, the group's first annual shortfall since 1992, and raised its estimate of costs arising from the Gulf of Mexico oil spill to $40.9bn.

The loss compared with a profit of $13.955bn in 2009, while the costs estimate was lifted from the previous forecast of $40bn.

"For the full year, the reported result was a loss of $4.9bn, including a total pre-tax charge related to the Gulf of Mexico oil spill of $40.9bn," BP said in an official results statement.

The group also announced that it will resume payment of its quarterly shareholder dividend, which was suspended in the wake of last year's devastating spill.

The Gulf oil disaster was triggered by a blast on the Deepwater Horizon rig - leased by BP and operated by Transocean Energy - that killed 11 workers on April 20.

The broken well was eventually plugged, but not before it gushed about 4.9 million barrels of oil into Gulf waters.

The spill ruined hundreds of miles of coastlines and caused BP's share price to collapse as its international reputation took a hammering.

The catastrophe sparked the resignation of chief executive Tony Hayward and led BP to announce that it was selling assets worth up to $30bn.

BP also disclosed that it will seek to sell two major refineries, including its Texas City facility, as the company aims to halve its refining capacity in the United States following the catastrophe.

In 2005, 15 workers were killed in a deadly explosion at the Texas City refinery.

BP's results statement was published one day after world oil prices rocketed past $100 per barrel for the first time since 2008, boosted by fears about the impact of the Egypt crisis on global crude supplies.


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