Markets
BP

BP Plc (BP) Projects Significant Production Growth by 2020

An image of a pen, a tablet and a calculator
Credit: Shutterstock photo

Energy giant BP PlcBP recently announced that it anticipates production to reach 4 million barrels of oil equivalent per day (BOE/D) by the end of 2020. The company had produced 3 million BOE/D in 2016.

The increased output will be supported by seven key developments that will start production in 2017. Out of the seven developments, two projects are already online, while the other two are yet to become operational. Nine projects, which are expected to come online next year, will also support BP's expected higher production.

BP added that with the present level of investment, production will spring back to levels before the 2010 Macondo oil spill incident. Investors should know that the energy major had to divest one third of its assets to make up for the losses associated with the oil spill.

Apart from focusing on oil and natural gas production, BP is now concentrating on the renewable energy sector. With the shift toward low carbon energy, BP has been eyeing renewables to boost its growth. In fact, BP has already inked an accord with General Electric Company GE to support its wind energy business.

Headquartered in London, BP is an integrated energy company. The company's stock underperformed the Zacks categorized Oil & Gas-International Integrated industry year to date. During the aforesaid period, the stock lost almost 3.2% as against 2.7% decrease for the broader industry.

Moreover, BP's reliance on Russia and offshore activity worldwide increases uncertainty amid sanctions and volatile . Given that Russia is the second-largest contributor to BP's production and earnings after the U.S., Russian sanctions would adversely affect company's operations as well as dividend income from its stake in Rosneft.

Moreover, BP's reliance on Russia and offshore activity worldwide increases uncertainty amid sanctions and volatile oil prices . Given that Russia is the second-largest contributor to BP's production and earnings after the U.S., Russian sanctions would adversely affect company's operations as well as dividend income from its stake in Rosneft.

As a result, the company carries a Zacks Rank #5 (Strong Sell).

Some better-ranked players in the energy sector includeCanadian Natural Resources Limited CNQ and McDermott International Inc. MDR . Canadian Natural sports a Zacks Rank #1 (Strong Buy), while McDermott carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .

We expect year-over-year earnings growth for Canadian Natural of 720% for the current year.

McDermott beat the Zacks Consensus Estimate in each of the trailing four quarters with an average positive surprise of 387.50%.

Will You Make a Fortune on the Shift to Electric Cars?

Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.

With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.

It's not the one you think.

See This Ticker Free >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

General Electric Company (GE): Free Stock Analysis Report

McDermott International, Inc. (MDR): Free Stock Analysis Report

Canadian Natural Resources Limited (CNQ): Free Stock Analysis Report

BP p.l.c. (BP): Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story

BP GE CNQ MDR

Other Topics

Stocks

Latest Markets Videos