Can BP Return to the Top?
BP (NYSE:BP) is trying to shed its past.
For the three-month period ended in September, the oil and gas company reported better-than-expected profit, which prompted BP to raise its dividend by 12.5 percent to 9 cents per share. The earnings statement, released Tuesday morning, showed earnings of $5.4 billion. In comparison, last quarter resulted in a loss of $1.4 billion after the company took writedowns on the value of its U.S. refineries and other assets.
Since the 2010 Macondo well disaster, which was the United States’ worst ever offshore environmental catastrophe, BP has lost its standing as one of the world’s largest oil and gas companies. However, with a return to profitability, the company is set to expand once more, despite uncertainty over the future of its Russian operations.
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The New York Times reported that BP’s chief executive Bob Dudley wants to use the oil spill as “an opportunity to streamline BP into more of a high-risk, high-reward exploration and production company.”
On Tuesday, Dudley stated that the company would focus on oil and exploration in the years ahead. Furthermore, he said BP’s Russian operations gave the company a “truly distinctive position in one of the world’s largest and most important oil and gas provinces.” Last week, the company decided to re-arrange its assets in Russia and sell half its stake in TNK-BP for $12.4 billion plus a 19.75 percent stake in state-controlled Russian group Rosneft.
But the company’s problems are not completely in the past. Although BP attempted to reach a settlement, the company faces a trial scheduled for late February 2013. In August, the Department of Justice made a court filing, accusing the company of gross negligence and a “culture of corporate recklessness.” BP has already paid over $8 in claims and spent $14 billion on clean-up operations.
Despite the impending court date, shares in BP rose 5 percent in London following the company’s earnings announcement.