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 Reports and Commentary from the Investment World

Reports and commentaries are posted here on a regular basis.




BP (BP:LSE) 2003-01-01

BP p.l.c. is a huge United Kingdom based energy company, operating in over 100 countries worldwide
Its principal activities are finding, producing and marketing natural energy resources.
The Company comprises of six business segments: exploration and production, pipelines and shipping, refining and marketing, gas and power, petrochemicals and renewable and alternative energy.

BP’s product lines include BP, am/pm, Aral, ARCO and Castrol.

BP is a vast company. It arose from the merger in 1998 of British Petroleum (English) and Amoco (American), which made it number three in the world in oil and gas behind Exxon Mobil (American) and Royal Dutch Shell.
BP Amoco operates in several fields, with reserves mainly in Alaska and the North Sea, the group is the American number one in oil and natural gas, its leading activity, which it distributes to different sectors, namely aviation, the navy, or business and industry.

A few figures suffice to demonstrate BP Amoco’s size: a daily output of 2.5 million barrels of oil (one barrel contains 159 liters) and 8.1 million barrels of gas, and it operates 30,000 gas stations throughout the world.
It is also highly successful in the refining sector, for example, selling 5 million barrels of fuel daily to petrol/gas stations.
In addition to this we have to also consider petrochemicals and specialty chemicals. BP Amoco also produces polyethylene, polypropylene and acetylene amongst others.

There are in total 52 production sites world wide, producing 25 million tons of products annually.

BP Amoco is also now becoming involved in the solar energy sector.

With a staff of almost 100,000, BP Amoco, undeniably a giant, is located in Europe, North and South America, Asia and Africa.

At this point in time BP is trading for less than 400p. This has got to be a bargain price for such an energy sector behemoth.

BP at 371p is trading currently on a prospective P/E of around 12 and offers dividend income of over 4%.
This reliable blue chip stock has not been this cheap for a decade.

Buy BP (BP:LSE) and hold long term.


Disclaimer: All the information above is provided as a service for individuals and institutions. It should in no way be construed as a recommendation as an investment. Investment decisions should be based on the risk tolerance and planning horizon of the investor. Market participants must understand that past performance is also not a guarantee or predictor of future results.