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BP plc (, , ), originally British Petroleum, is a British energy company with headquarters in London, one of six vertically integrated private sector oil, natural gas, and petrol (gasoline) "supermajors" in the world.
Company history In August 1998, British Petroleum merged with the Amoco Corporation (Amoco), forming "BP Amoco." This move was widely viewed as a takeover of Amoco by BP and was only officially described as a merger for legal reasons (after a single year of joint operations, "Amoco" was dropped from the corporate name). The newly-renamed "bp" became an initialism no longer overtly standing for "British Petroleum". At the same time BP used the punning tagline "Beyond Petroleum" in some advertising campaigns. The step away from "British Petroleum" was in part a reflection of the fact that BP had become a global business and also that the direct identification of the company as British could be a disadvantage in some areas of operation. In the 2006 Fortune Global 500 list of companies, BP was ranked 4th in the world for turnover with sales at $268 billion (down from 2nd in 2005 and 1st among oil companies), in the 2006 Forbes Global 2000 it was ranked the eighth-largest company in the world. BP's profits in 2005 amounted to $22.341 billion with replacement cost profit after interest, tax and minority shareholders' interest taken into account of $19.3 billion•. BP Solar is the world-leading producer of solar panels through a series of acquisitions in the solar power industry. Recently, BP announced that its solar, wind and hydrogen power businesses would be known as BP Alternative Energy. BP is the leading partner in the controversial Baku-Tbilisi-Ceyhan pipeline. 1909 - 1955 In May 1901, William Knox D'Arcy was granted a concession by the Shah of Iran to search for oil which he found in May 1908. This was the first commercially significant find in the Middle East. On 14 April 1909, the Anglo-Persian Oil Company was incorporated to exploit this find. The company grew slowly until World War I when its strategic importance led the British Government to acquire controlling interest in the company and it became the Royal Navy's chief source of fuel oil during World War I. In 1917, the war allowed it to take the British arm of the German Europäische Union, which used the trade name British Petroleum. After the war ended, the company, in which the British Government now had a 51% interest, moved to secure outlets in Europe and elsewhere. However, its main concern was still Persia, following the Anglo-Persian Agreement of 1919 the company continued to trade profitably in that country. In 1931, partly in response to the difficult economic conditions of the times, BP merged their marketing operations in the United Kingdom (only) with those of Shell-Mex Ltd to create Shell-Mex and BP Ltd a company that continued to trade until the Shell and BP brands separated again in 1975. There was growing dissent within Persia however at the imperialist and unfair position that APOC occupied. In 1932, the Shah terminated the APOC concession. The concession was resettled within a year, covering a reduced area with an increase in the Persian government's share of profits. Persia was renamed Iran in 1936 and APOC became AIOC, the Anglo-Iranian Oil Company. Following the turmoil of World War II, AIOC and the Iranian government resisted nationalist pressure to come to a renewed deal in 1949. In March 1951, the pro-western Prime Minister Ali Razmara was assassinated and in April, a bill was passed nationalising the oil industry and the AIOC and the Shah were forced to leave the country. The AIOC took its case against the nationalisation to the International Court of Justice at The Hague, but lost the case. However the government of Britain, concerned about its interests in Iran, convinced the US that Iran was slowly coming under Soviet influence. This was the perfect strategy for the British since the US was in the middle of the Cold War. The British convinced the US to join them in overthrowing the democratically chosen Prime Minister, Mohammed Mossadeq, and to install pro-Western General Fazlollah Zahedi as prime minister of Iran. This overthrow was named Operation Ajax.Mohammed Mossadegh thought that nationalization was the only way to prevent British exploitation of Iran's oil wealth. On August 19 1953, the incumbent democratic Prime Minister, Mohammed Mossadeq, was forced from office and replaced by Zahedi and the Shah was recalled. The AIOC became The British Petroleum Company in 1954, and briefly resumed operations in Iran with a forty per cent share in a new international consortium. BP continued to operate in Iran until the Islamic Revolution. However, due to a large investment programme (funded by the World Bank) outside Iran, the company survived the loss of its Iranian interests at that time. 1960s and 1970s From the late 1960s the company looked beyond the Middle East to the USA (Prudhoe Bay, Alaska) and the North Sea. Both of these fields came on stream in the mid-1970s transforming the company and allowing BP to weather the OPEC-induced oil price shocks of 1973 and 1979. In 1969, BP acquired the Valdez oil terminal, Alaska, from the Chugach for $1. Some natives contend that this was an illegal transfer. In the mid-1970s, BP acquired Standard Oil of Ohio or Sohio. 1980s and 1990s P.I. Walters (later Sir Peter Walters) was BP's chairman from 1981 to 1990. Walters promoted a movement to deintegrate company operations based solely upon economic considerations: "For me, there is no strategy that is divorced from profitability," he once remarked. Under his chairmanship British Petroleum led the oil industry away from an era dominated by vertical integration and the supply planning this required toward a corporate culture that emphasised trading and decentralisation (Daniel Yergin, The Prize Simon & Schuster, 1991, pp. 722-23). In 1987, British Petroleum acquired Britoil and those shares of Standard Oil of Ohio (Sohio) not already owned. In 1994, BP and Petroleos de Venezuela SA (PDVSA) began marketing Orimulsion®, a bitumen-based fuel. Lord Browne of Madingley, who had been on the board as managing director since 1991, was appointed group chief executive in 1995. Present
Prudhoe Bay shutdown As of August 7, 2006, BP has begun to shutdown oil operations in Prudhoe Bay, Alaska. This is due to "unexpectedly severe corrosion" in transit pipelines on the Prudhoe Bay oil field. Prudhoe Bay only produces about 2.6% of the United States demand for gasoline. It was initially estimated that the shutdown would cause a reduction of 400,000 barrels per day and reaction to that scenario was a contributing factor pushing the price of oil to over $77(USD) per barrel.•To, date 1,513 barrels of liquids, about 5,200 cubic yards of soiled snow and 328 yards of soiled gravel have been recovered. There are estimates that about 5,000 barrels of oil were released from the pipeline. After further analysis and approval from the DOT, only the eastern portion of the field was shut down which resulted in a reduction of 200,000 barrels per day until work began to bring the eastern field to full production on Oct 2.• Image In 2002 the company was renamed BP, with no meaning given to the letters. Its new slogan, "Beyond Petroleum", was accompanied by the rebranding of its famous "Green Shield" logo in favour of the helios symbol (a green and yellow sunburst) to emphasise the company's focus on environmentally friendly fuels and alternative energy. This is intended to move BP away from the negative environmental image of most oil companies. However, some environmental groups have accused BP of trying to greenwash their public image, and that their alternative energy credentials are not serious investments but merely a PR exercise. BP is a leading producer of solar panels since its purchase of Lucas Energy Systems in 1980 and Solarex (as part of its acquisition of Amoco) in 2000. BP Solar had a 20% world market share in photovoltaic panels in 2004 when it had a capacity to produce 90 MW/year of panels. It has over 30 years experience operating in over 160 countries with manufacturing facilities in the U.S., Spain, India and Australia and has more than 2000 employees worldwide. In February 2002 BP's chief executive, Lord Browne of Madingley, renounced the practice of corporate campaign contributions, noting: "That's why we've decided, as a global policy, that from now on we will make no political contributions from corporate funds anywhere in the world." * In March 2002 Lord Browne of Madingley declared in a speech that global warming was real and that urgent action was needed, saying that "Companies composed of highly skilled and trained people can't live in denial of mounting evidence gathered by hundreds of the most reputable scientists in the world.".* In 2005 BP was considering testing carbon sequestration in one of its North Sea oil fields, by pumping carbon dioxide into them (and thereby also increasing yields).* In 2004, BP began marketing low-sulphur diesel fuel for industrial use. BP intends to create a network of hydrogen fuelling stations in the state of California. However, BP's image has been tarnished somewhat by its involvement with the controversial Baku-Tbilisi-Ceyhan pipeline, criticised for human rights abuses, environmental and safety concerns. BP has also been criticised for the increase in fuel prices in the UK, on April 25 2005 Lord Browne stated in an interview with the BBC that he fully expected petrol prices to stay above £1 per litre. BP has also been involved in bringing lawsuits against biofuel and biodiesel producers and sellers in France and other countries. In July 2006, a group of Colombian farmers won a multimillion pound settlement from BP after the British oil and gas company was accused of benefiting from a regime of terror carried out by Colombian government paramilitaries to protect a 450-mile pipeline. On August 7 2006, BP reported that their Prudhoe Bay oil field had to be shut down after a pipeline inspection gauge determined there was excessive corrosion in the transport pipeline.. BP was criticized for the maintenance practices on the damaged pipeline, which was last inspected for corrosion in 1992. BP have started a scheme for car owners to purchase carbon offsets called Target Neutral. See also | |||||||||||||||||||||||||||||||||||
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