Giulia Chierchia: Yes. Thanks. So thank you, . Let me start by saying that we actually clearly support the efforts in terms of transparency in the economy. We’re looking to see what happens in terms of all the multiple taxonomies coming together, CSRB, the EU taxonomy. We will start disclosing along the new taxonomy in 2025 based on 2024 data as required by the CRB. Now if you look into how much of our investment is actually going to be aligned to the taxonomy, we’ll be disclosing our investments into transition growth engines until then. And you can assume that towards 2030, a significant majority of that will be aligned to the taxonomy.
Bernard Looney: Great. Thank you, Giulia. Excellent. Paul Cheng, Scotiabank, and then we’ll come back to the room.
Paul Cheng: Two questions, please. What’s the assumption — I think this is for Murray. What’s the assumption that behind the high end and the low end of your capital range. I mean, what is the parameter behind that? The second one is that maybe that is for Bernard. So if we’re looking outside your transitioning business on the conventional or legacy oil and gas, should Europe be part of your long-term portfolio, given the political environment?
Bernard Looney: Very good, Paul. Thank you. So Murray, the question, I think, was what would guide you to $14 billion or $18 billion. What’s the marginal thing to do in there.
Murray Auchincloss: Great. Thanks, Paul. Nice to hear you earlier in the morning in the U.S. I think 2023 is a good way to think about our guidance. Right now, the hydrocarbon prices are pretty strong. And as we’ve said, we expect them to continue to be elevated. Our organic CapEx in 2022, if you look at the fourth quarter, started to tick up probably into the low 14s. And if you multiply by 4 our quarterly run rate in — and of course, we’ve added the Archaea pipeline, which will increase organic CapEx. We’re adding more rigs, which will add CapEx. So we’re probably at an organic run rate now of $14 billion to $15 billion in 2023. what we’ve guided is $16 billion to $18 billion, including inorganics. So given the high price environment, given what we’re seeing organically, that gives you a sense of what our organic inorganic split is.
And looking forward, we’ll be guided by the price range that’s out there in the market each year as we think about that 14 to 18 range if prices fall back to the $40 level, we’ll obviously be at the lower end of the range as prices remain high, we’ll have the flexibility to stay at the upper end of the range. I think that’s probably what I’d say, Bernard.
Bernard Looney: Great. Thank you, Murray. And Paul, on Europe, I mean, I won’t collapse and make kind of regional statements in general other than to say we’re returns driven, our investments have to make the returns that we’ve laid out. There are some great opportunities in Europe today. We have a strong oil and gas business in the U.K. North Sea. We have a strong oil and gas business in Norway with Archaea BP. We are, I think, the fastest charging, the largest fast charging provider in Germany today. We’re excited about that. We have a new partnership with Ignacio Galan and the Iberdrola team that we’re very excited about in Spain around hydrogen and the potential for that. So it’s a case-by-case basis, Paul. We look at all countries.
We look at — ultimately, we have to be driven. Our investments are driven by our returns criteria. And there are great opportunities in countries around Europe, just like there are great opportunities. elsewhere in the world. So let me leave it at that and come back to the room to Chris Kuplent, please, and then we’ll — there must be some people over here, but excellent. Chris, go ahead.
Christopher Kuplent: Chris Kuplent from Bank of America. One under the banner of CapEx discipline. Just wondered whether your hurdle rates in upstream have changed alongside your 60 to 70 move on the real assumptions for pricing. And if you could, there’s quite a big difference between 1.5 million and 2 million barrels per day in 2030. So I just wonder whether you could maybe go and talk us through the additional projects that would make up either the stemming of decline or the much lower assumed disposals that are behind this new target. And maybe as a bonus question, what makes you so confident that with no reduction in your refining footprint and now a much higher oil and gas footprint upstream, your Scope 1 and 2 targets can remain unchanged.
Bernard Looney: Very good. I’ll have Gordon take the scope on and 2 questions as well. We’ll kick off with Murray first.
Murray Auchincloss: On hurdle rates? No change to hurdle rates, Chris.
Bernard Looney: Yes. So we go from that then to — what are we keeping? You’re not well, let you answer your question, $1.5 million to $2 million, and how are you going to deliver the Scope 1 and 2 emissions, which we have not changed, Chris, as you quite widely pointed out. So Gordon?
Gordon Birrell: Great question, Chris. Thank you for that. So we have a hopper of opportunities of 18 billion barrels. That’s what underpins our plan to 2030. And I have to say — the subsurface team under the leadership of have done a fantastic job of articulating these 18 billion barrels numerically and quality-wise, much better than I’ve seen in the past. We’ve got 18 billion barrels in there as we bring forward the opportunities they have to hit the hurdle rates and as Murray said, no hurdle rates. We’ve got to create momentum through to 2025. We’ve got 5 major projects coming on this year, a little bit back-end loaded, but 5 major projects that we have confidence, big projects, projects like Phase 1 in Mauritania, Senegal, projects like Tang Phase I in Indonesia, projects like Argos, Mad Dog 2 in the Gulf of Mexico, they’re going to come on and they’re going to bring high-quality barrels with them.
Through to 2025, we’ve got 9 at over 9 major projects coming on stream. So again, creating that momentum through to 2025. And then from ’25 to ’30, we have a rich opportunity set within that 18 billion barrels, so we can make choices that will continue to offset decline, allow us to sell the 200,000 barrels per day that was mentioned earlier is to end up at 2 million barrels per day by 2030. So I’m very confident that the resources in the ground — we’ve got the teams in place to execute. We keep driving capital productivity under Andy Kreger in wells. I’ll give you just 1 example, a fast piece tieback we’re executing right now in the Gulf of Mexico. Thunder Horse expansion between Phase 1 of that expansion in Phase II where half the cost safely, half the cost of a deepwater well.
That’s just one example of how we’re driving productivity. And all these things just give us confidence that the Clear Ridge team doing similar great work, subsurface-wise, drilling wise to develop the giant field west of Shetland more productively, more efficiently. So I’m actually very confident that we’ve got the resources in the ground. We’ve got tremendous teams in place to execute and all we need to do now is execute well through the balance of this decade.
Bernard Looney: Great. And you’ve kept your Scope 1 and 2 target constant despite the higher refining throughput and a higher production. How have you done that?
Gordon Birrell: It just makes it harder. That’s as simple as that. I think the world, the company, our stakeholders required cover on our give confidence. And I think, look, we’ve got a track record of delivering 1 million — roughly 1 million tonnes per annum of sustainable aviation reductions, just through improving the way we operate. We’re now starting to fill the hopper with projects that are slightly longer wavelength maybe require a bit of capital. So we’ve got lots of opportunities here to deliver on that AMI. It’s never easy. You got to while you’re operating, you’ve got to look for emission reduction. But I think that AMI is deliverable. I’m confident it’s deliverable, and we’ll continue to fill the hopper with opportunities through the balance of the decade.
Bernard Looney: And the reality is, it’s what society needs. And quite frankly, Chris, it’s what our people want to deliver. They don’t want to see us going back on A1 and we control it and we’re leaning into it. And we’ll find — it’s harder, of course, it’s gotten harder, but we’re going to deliver it. So thanks for raising that point. We’ll go here in the audience.
Unidentified Analyst: Patrick from UBS. I have a couple of follow-up questions. The first one on the upstream and the change in the production outlook to 2030. Should we expect a major change in terms of allocation between oil and gas and. Obviously, You raised your oil price due to . So should we expect to be skewed towards all projects in the later part of this decade? Or do you still intend to keep that fairly balanced oil gas.
Gordon Birrell: I think we’ll be fairly balanced oil and gas, Patrick, good question. Fairly balanced oil and gas. And of course, every one of these projects must go through our investment reach our investment hurdles. That will be the primary determinant of how we invest. But as we look forward to the 18 billion barrels, and I can see more than a dozen major project FIDs coming towards us from that hopper and it’s pretty balanced oil and gas.
Bernard Looney: Returns driven at the end of the day.
