-Caveat Lector- Euphorian spotted this on the Guardian Unlimited site and thought you should see it.
To see this story with its related links on the Guardian Unlimited site, go to http://www.guardian.co.uk Cut, cut and cut again at BP Gold-plated performer loses lustre after dumping forecasts for third time Terry Macalister Tuesday October 29 2002 The Guardian BP, Britain's biggest company and one of its most reliable performers, yesterday shocked the City by cutting its oil and gas output forecasts for the third time in eight weeks. The setback led to a fall in shares of 6% to 397p, their lowest for four years, further denting the formerly gold-plated reputation of chief executive Lord Browne. The country's most profitable group also reported a 13% fall in third quarter earnings to $2.3bn (£1.5bn) and downgraded its "self-help" targets for cost-cutting from $1.4bn for the year to between $1.2bn and $1.4bn. BP made clear it plans an attack on costs and underlined the threat to jobs by confirming a big shake-up was on the way for Sullom Voe, Europe's biggest oil and gas terminal. Output targets have become a key indicator for oil groups - Shell's shares were hammered last year when it admitted its forecasts were too optimistic. Lord Browne made little attempt to evade responsibility for the failure, admitting he had not left enough "headroom" for things to go wrong. He blamed the latest blow to upstream production targets on hurricanes in the Gulf of Mexico as well as operational difficulties in Alaska and the North Sea. The company said it had added to its own problems by reallocating too much capital spending away from sustaining base production to longer term growth projects where it saw better returns. There had been no easy ways of bringing in new production through corporate acquisitions, said BP, because higher crude prices had left companies fully valued. "The past nine months have not been happy ones for this part of our operations. We had hoped to grow our oil and gas output by 5.5% for the year, but we have failed to do so," Lord Browne explained. "The net impact is that we now expect production growth of around 3% for 2002. This is deeply disappointing," he added. Long term targets were being reassessed, he said, as he rejects acquisitions as a means of getting out of trouble. The oil major had promised to increase output by between 5.5% to 7.0% between 2000 and 2005. It denied this ambitious goal had been shelved but said it would cost an extra $1bn to get there. "The key question we are now asking ourselves is: should we [spend that]?" An answer to that is promised at a full-year financial results briefing in February, along with detailed plans for cutting costs, including the possible sale of upstream assets. Lord Browne said the problems had led to a focus on efficiency, and whether the successive mergers with Amoco and Arco had led to too great a rise in overheads. "Field level costs are under control, but the question is the overheads we carry above them. We have too much complexity and a little middle-aged spread. We will address this," he said. Some cash would be saved through lower performance bonuses, including his own, but Lord Browne declined to comment on whether there would be a change in senior personnel. Over 550 people work at Sullom Voe in the Shetland Islands and part-owner BP admits there must be savings. Chief financial officer John Buchanan has already announced his retirement; he will be replaced on November 21 by Byron Grote, the chief executive of BP Chemicals. Analysts described the production failures as "very disappointing", and Merrill Lynch cut its recommendation from "buy" to "neutral". Copyright Guardian Newspapers Limited <A HREF="http://www.ctrl.org/";>www.ctrl.org</A> DECLARATION & DISCLAIMER ========== CTRL is a discussion & informational exchange list. Proselytizing propagandic screeds are unwelcomed. Substance—not soap-boxing—please! These are sordid matters and 'conspiracy theory'—with its many half-truths, mis- directions and outright frauds—is used politically by different groups with major and minor effects spread throughout the spectrum of time and thought. That being said, CTRLgives no endorsement to the validity of posts, and always suggests to readers; be wary of what you read. CTRL gives no credence to Holocaust denial and nazi's need not apply. Let us please be civil and as always, Caveat Lector. ======================================================================== Archives Available at: http://peach.ease.lsoft.com/archives/ctrl.html <A HREF="http://peach.ease.lsoft.com/archives/ctrl.html";>Archives of [EMAIL PROTECTED]</A> http://archive.jab.org/ctrl@;listserv.aol.com/ <A HREF="http://archive.jab.org/ctrl@;listserv.aol.com/">ctrl</A> ======================================================================== To subscribe to Conspiracy Theory Research List[CTRL] send email: SUBSCRIBE CTRL [to:] [EMAIL PROTECTED] To UNsubscribe to Conspiracy Theory Research List[CTRL] send email: SIGNOFF CTRL [to:] [EMAIL PROTECTED] Om
