BP logs $1.4 billion loss
BP faced another net loss in the second quarter but has now drawn a line under the 2010 Gulf of Mexico oil spill disaster, the British energy giant said yesterday. The company posted a loss after taxation of $1.4 billion (1.3 billion euros) for the three months to June, which however compared with a far larger loss of $5.8 billion for the second quarter of 2015. BP also booked a net post-tax non-operating charge of $2.8 billion for costs linked to the oil disaster. That included a pre-tax non-operating charge of $5.2 billion. The energy major had already revealed earlier this month that the final cost for the spill stood at $61.6 billion, including the latest second-quarter hit.
BP added that this year’s capital expenditure was now expected to fall below $17 billion. “We are very pleased to have finally drawn a line under the material liabilities for Deepwater Horizon,” said chief executive Bob Dudley in the results statement. “We will always be mindful of what we have learned from that tragic accident. BP today is a stronger, more focused and more disciplined company. “We continue to actively develop a strong, balanced portfolio and we are managing the business for value over volume. “Our relentless group-wide focus on capital and cost discipline is helping BP to become much more efficient while maintaining the investment needed for future growth.”
Back in 2010, an explosion on the Deepwater Horizon oil rig killed 11 men off the coast of Louisiana and caused 134 million gallons (507 million litres) of oil to spew into Gulf waters. It took 87 days to cap the out of control well some 1,500 meters (5,000 feet) below sea level, and the oil slick stretched across an area the size of Virgina, blackening beaches across five US states and hitting tourism and fishing. Londonlisted BP had clocked enormous losses last year on costs linked to the deadly spill. It has axed thousands of jobs and sold billions of dollars of assets to meet the clean-up bill.
“The sigh of relief emanating from BP HQ is almost palpable as the Gulf of Mexico spill is finally consigned to the history books,” noted Richard Hunter, head of research at Wilson King Investment Management. “This is not to say that the challenges are over, not least of which is an underlying oil price still markedly short of the level which would provide comfort for the company.” — AFP