BP takes £3.1bn hit to profits

BP today announced that it plans to resume the payment of quarterly dividends, which were suspended last June following Gulf of Mexico oil spill. The news comes as the oil […]

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By Kelvin Ross

BP today announced that it plans to resume the payment of quarterly dividends, which were suspended last June following Gulf of Mexico oil spill.

The news comes as the oil major also reported a loss of £3.1bn, the first time it has suffered an annual loss since 1992.

The bulk of the loss can be put down to charges resulting from the oil spill from the Deepwater Horizon.

BP group chief executive Bob Dudley said: “2010 will rightly be remembered for the tragic accident and oil spill in the Gulf of Mexico and it is clear that as a result BP is a company in transition.”

He said BP was determined to emerge from the Gulf of Mexico disaster “as a company that is safer, stronger, more sustainable, more trusted and also more valuable”.

Mr Dudley added: “2011 will be a year of recovery and consolidation as we implement the changes we have identified to reduce operational risk and meet our commitments arising from the spill. But it will also be a year in which we have the opportunity to reset the company, adjusting the shape of our business, and focus on growing value for shareholders.”

Today BP also revealed that it wants to sell its refineries in Texas City and Carson. In 2005, a blast at the Texas City plant killed 15 workers and injured another 170.

On the decision to restart paying quarterly dividends, BP chairman Carl-Henric Svanberg said: “We believe now is the right time to resume payment of a dividend to our shareholders. We have chosen a prudent level that reflects the company’s strong underlying financial and operating performance but also recognises the need to fully meet our obligations in the Gulf of Mexico and to maintain financial flexibility.”

In January, BP announced an alliance with Russian energy company Rosneft, which will see the two companies drill in the Russian Arctic.

However the deal has proved controversial, and today Russia’s third largest oil company, TNK-BP, is in the High Court in London in a bid to win an injunction stopping the deal. TNK-BP, which is 50%-owned by BP, believes the pact gives Rosneft exclusive rights to pursue new opportunities in Russia on behalf of BP.