British Petroleum: Global and UK Business
British Petroleum or BP, as it is commonly known, has its global headquarters in London, and is one of the biggest companies in the UK. It operates in almost all locations across the length of UK. The operations extend all the way from Sullom Voe in Shetlands, to Hamble on England's South Coast. BP's UK exploration and Production business is based in Aberdeen and accounts for 10% of the global oil production. BP is a pioneer in the energy sector in the UK. Apart from selling a range of high quality fuels like BP Ultimate through 1200 service stations, it also sells lubricants, Liquefied Petroleum Gas (LPG) and solar power. BP Solar has set up over 4MWp of solar electric systems in the UK. The company's Scolar Program for Photovoltaics, and the installation of solar panels on BP retail sites and buildings prove that BP is a pioneer in utilizing solar energy for electricity generation.
The uniqueness of the BP service stations in the UK stems from the fact that apart from providing high quality fuel, this firm runs forecourts that cater to customer requirements including food, drink, newspapers, hot meals, car accessories, etc. Over 100 BP service stations in Scotland and England have Marks and Spencer Simply Food outlets on its premises, and BP Connect Stores can be found in more than 300 company owned, or franchisee sites, existing alongside the award winning Wild Bean Cafes. These outlets provide motorists the much need succor of hot and cold snacks and coffee.
As part of its corporate social responsibility, BP Educational Service provides energy related teaching aids to help educate primary and secondary students. It has also managed to open a new gallery at the London Museum, which helps young students understand and explore energy, and encourages them to conjure up alternative methods of generating energy.
Though BP is the one of the largest companies in the UK, it faces tough competition from other oil companies such as Exxon Mobil Corporation, Chevron Corporation, Petroleo Brasileiro SA, Royal Dutch Shell PLC and Total SA, which manage to outperform BP from time to time.
Despite such tough competition, opportunities in the energy field are numerous. It is estimated that the energy consumption of the world will increase by 49% by the year 2030. This means excellent opportunities for all players in the energy field. Opportunities for BP have presented themselves in the form of US investment pouring in for research of alternative fuel methods, including hydrogen, wind, solar energy and natural gas.
Future plans of BP also involve trying to expand suitable areas beyond Soviet-Union territories, so they can become its future reserves. It is also looking at launching a more flexible price policy, in order to be able to manage competition. Despite having such comprehensive plans for the future, the company faces the threat of bankruptcy due to several factors: unsound environmental policies that lead to oil and toxic spills, occasional explosions in its refineries; pipeline corrosion; competition from Chevron and Shell; lawsuits regarding the company's ecological activities; non-compliance to regulations as in the 2009 market manipulation, etc. This oil giant is also one of the companies involved in one of the worst oil spills in history: the Deepwater Horizon rig incident. This incident prompted immense losses on a scale previously not experienced by BP.
With the possibility of a debarment on BP America, the future of BP is uncertain. At this juncture, the questions facing the shareholders have are:
-Will BP be allowed to do business in the U.S, even after its harrowing history, or will the firm incur further losses?
-Will the new CEO Bob Dudley be able to handle the crisis that has thrown the company off balance?
-Will BP survive this loss, or will it declare bankruptcy, sinking the shareholders in the process?