annual report and accounts 2000 exploration and production Activities: Present in 25 countries; production operations in 21 countries Daily production: 1.93 million barrels of crude oil and 7.6 billion cubic feet of natural gas (60% oil, 40% gas) Discoveries: 33 giant finds 1996-2000 (>250mmboe) Reserves: 15.2 billion barrels of oil equivalent (50% oil, 50% gas) Reserve replacement ratio: 160% Reserve replacement exceeded production in 2000 for the seventh consecutive year gas and power Activities: Gas sales contracts in 24 countries Gas sales volumes: 14.5 billion cubic feet a day Power: 1,900MW power generation projects under development or construction refining and marketing Refineries (wholly or partly owned): 24 Refinery throughput: 2.9 million barrels of crude oil a day Oil product marketing sales: 3.8 million barrels a day Service stations: 29,000 chemicals Sites worldwide: 55 Production: 22.1 million tonnes a year Revenues: $11.2 billion a year BP Amoco p.l.c. is the parent company of the BP group of companies. The term ‘shareholders’ in this report means, unless the context otherwise requires, investors in the equity capital of BP Amoco p.l.c., both direct and/or indirect. The report of the directors on the business of the company and its subsidiary undertakings is on pages 2-28 and 71-85 inclusive. The consolidated group accounts are on pages 30-62 inclusive. The report of the auditors is on page 63. Unless otherwise stated, the text does not distinguish between the activities and operations of the parent company and those of its subsidiary undertakings. The report and accounts are of the financial year ending on 31 December 2000. The registered office of BP Amoco p.l.c. is: Britannic House, 1 Finsbury Circus, London EC2M 7BA, UK Telephone: +44 (0)20 7496 4000 Registered in England and Wales No. 102498 Stock exchange symbol ‘BP’ BP’s Annual Report and Accounts 2000 is available in the form of one integrated document as a download from www.bp.com/downloads/annualreport2000 No other material on the BP corporate website, except that found at the cited URL, forms any part of the Annual Report and Accounts 2000. view Find regular updates, latest 1 basics 8 objectives video footage, downloads, Describing the fundamentals Group chief executive Sir John online investment calculator and of BP’s business, with a letter Browne explains the market much more on our website from the chairman, a look context for BP’s operations Investment calculator back at 2000’s key events and outlines our strategy for and a series of measures 2001 and beyond. Audio footage reporting both financial and non-financial performance. 8 Group chief executive’s Video footage review 1 Introduction Downloads 2 Performance highlights FAQs 4 The year at a glance 6 Chairman’s letter @ www.bp.com basics introduction welcome BP today is a diverse enterprise of some 100,000 people working together in more than 100 countries around the world to provide the energy and choices a growing global population needs to develop and prosper in the 21st century. Every day we serve millions of customers with products intrinsic to their lives – fuel for transport, energy for heat and light, solar power, and petrochemicals for plastics. At all times we try to look beyond traditional ways of doing business; to find new ways to deliver outstanding performance. The test of our success must always be our ability to generate strongly competitive returns for our shareholders in a sustainable manner and to touch the life of every individual our business reaches in a distinctive and positive way. This annual report for 2000 sets out our performance against objectives during the past 12 months and explains our plans for the year to come. 12 performance 29 accounts 71 governance 85 shareholder Reporting our performance not 30 Accounting policies & policy information only in financial terms but also 32 Financial statements against our commitments on 35 Notes on accounts Explains the work of the 85 Shareholdings and health, safety, environmental board of directors and the annual general meeting care and social investment. 63 Directors’ responsibilities company’s relationship with for the accounts its shareholders. 86 Information for ordinary 14 Business operating review 63 Report of the auditors or preference 18 Environmental and 64 Oil and natural gas 72 Board of directors shareholders social review reserves 76 Corporate governance 87 Information for 20 BP worldwide 65 Five-year summary 79 Executive directors’ ADS holders 22 Financial review 68 Operating statistics remuneration 88 Further information and 69 US accounting principles acknowledgements 70 Glossary BP 2000 / 1 performance highlights BP’s results in 2000 reflect the inclusion of ARCO and Burmah Castrol and the full consolidation of the European key financials refining and marketing joint venture from 14 April, 7 July $ million 2000 1999 and 1 August 2000 respectively. Pro forma result adjusted for special items 14,203 6,206 Replacement cost profit before exceptional items 11,214 5,330 In 2000, we are reporting a new business stream, Gas and Replacement cost profit after exceptional items 11,142 3,280 Power, which is responsible for our worldwide gas marketing Historical cost profit after exceptional items 11,870 5,008 activities and all business development opportunities in natural Per ordinary share – cents gas, including gas-fired power stations. Pro forma result adjusted for special items 65.63 32.00 Replacement cost profit before exceptional items 51.82 27.48 Owing to the significant acquisitions that took place in Dividends per ordinary share – cents 20.50 20.00 2000, in addition to its reported result BP is presenting pro – pence 13.791 12.339 forma results, adjusted for special items, in order to enable Dividends per ADS – dollars 1.23 1.20 shareholders to assess current performance in the context of our past performance and against that of our competitors. The pro forma result, adjusted for special items, has been derived from our UK GAAP accounting information but is not reconciliation of reported profit/loss to pro forma in itself a recognized UK or US GAAP measure. References result adjusted for special items 2000 1999 within the Directors’ Report to ‘operating result’ and ‘result’ Pro forma are to pro forma results, adjusted for special items. Acquisition Special result adjusted $ million Reported amortizationa itemsb for special items References to ‘fixed assets’, ‘capital employed’, ‘operating Exploration and Production 14,012 1,174 524 15,710 7,282 capital employed’ and ‘net debt plus equity’ are to these Gas and Power 186 – – 186 211 measures on a pro forma basis which excludes the fixed Refining and Marketing 3,908 440 595 4,943 2,082 asset revaluation adjustment and goodwill consequent upon Chemicals 760 – 276 1,036 933 the ARCO and Burmah Castrol acquisitions. Return, return Other businesses and corporate (1,110) – 488 (622) (428) on average capital employed and the net debt ratio (net debt/ Replacement cost net debt plus equity) refer to ratios calculated using these operating profit 17,756 1,614 1,883 21,253 10,080 measures. References to ‘capital expenditure and acquisitions’ Interest expense (1,770) – 111 (1,659) (1,292) and ‘acquisitions’ exclude the cost of the ARCO acquisition. Taxation (4,680) – (540) (5,220) (2,444) Minority shareholders’ interest (92) (79) – (171) (138) RC profit before exceptional items 11,214 1,535 1,454 14,203 6,206 a Acquisition amortization for 2000 refers to depreciation relating to the fixed asset revaluation adjustment and amortization of goodwill consequent upon the ARCO and Burmah Castrol acquisitions. There was no acquisition amortization in 1999. b The special items refer to non-recurring charges and credits. The special items in 2000 primarily comprise ARCO, Vastar and Burmah Castrol integration costs, rationalization costs following the merger of BP and Amoco, a provision against the group’s chemicals investment in Indonesia, environmental charges and asset write-downs. dividends per share result result per share cents pence $ billion cents 24 16 15 66 18 12 10 44 12 8 5 22 6 4 0 96 97 98 99 00 0 0 9697989900 0 9697989900 cents per share pence per share BP 2000 / 2 basics performance highlights capital expenditure capital expenditure environmental emissions and acquisitions and acquisitions 2000 2000 1999 $ billion $ billion BP Underlyinga BP 24 Greenhouse gas emissions (million tonnes)b 80.7 72.2c 79.8 18 Hydrocarbon emissions to air (’000 tonnes) 688 636 845 12 Discharges to water (’000 tonnes) 58 52 46 Number of spills reaching land 6 or water (>1 barrel)d 503 413 732 a BP operations excluding ARCO and Burmah Castrol. 0 9697989900 UK 37% b BP share of emissions of carbon dioxide and methane, expressed as an equivalent mass capital expenditure Rest of Europe 10% of carbon dioxide. acquisitions USA 33% c 9.5% decrease from 1999 comprises 3% in respect of continuing operations and 6.5% Rest of World 20% due to asset divestment and other changes. d 1 barrel = 159 litres = 42 US gallons. return on average operating capital workforce days employee satisfaction capital employed employed 2000 away from work indexa % case frequency a % 30 0.50 60 0.40 20 40 0.30 0.20 10 20 0.10 0 9697989900 UK 19% 09796 98 99 00 09900 a Rest of Europe 9% a An injury or illness that results in The index is calculated using USA 38% a person being unable to work responses to the People Rest of World 34% for a day (shift) or more. The Assurance Survey sent annually frequency is per 200,000 hours. to BP staff worldwide, covering Workforce includes employees leadership, diversity, staff and contractors.