BP logs huge loss due to Russia exit

Energy giant and LNG player BP reported a huge quarterly loss after writing down $24 billion to exit its Russia operations.

BP’s first-quarter loss was $20.4 billion, compared with a profit of $2.3 billion in the prior quarter and $4.6 billion in the first quarter of 2021.

The figure includes pre-tax charges of $24 billion and $1.5 billion as a result of the loss of significant influence and bp’s decision to exit its 19.75 percent shareholding in Rosneft and its other businesses with Rosneft in Russia, it said.

However, BP’s underlying replacement cost profit reached $6.2 billion in the first quarter, compared with $4.1 billion for the previous quarter and $2.6 billion in the same quarter last year.

BP attributed the rise to “exceptional” oil and gas trading, higher oil realizations and a stronger refining result.

The firm has a significant presence in the LNG industry and it recently signed a deal with South Korea’s Kogas to supply the latter with 1.58 million tonnes of LNG per year for a period of 18 years.

BP plans to grow its LNG portfolio from 18 mtpa in 2021 to 30 mtpa by 2030.

“In a quarter dominated by the tragic events in Ukraine and volatility in energy markets, BP’s focus has been on supplying the reliable energy our customers need,” chief executive Bernard Looney, said.

“Our decision in February to exit our shareholding in Rosneft resulted in the material non-cash charges and headline loss we reported today. But it has not changed our strategy, our financial frame, or our expectations for shareholder distributions,” Looney said.

For the first quarter, BP has announced a dividend of 5.46 cents per ordinary share payable in June 2022.

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