BP is now the world’s largest oil producer
Over the last three quarters, boosted by the TNK acquistion, BP has out-produced ExxonMobil to become the world’s largest publicly quoted producer of crude and natural gas liquids (NGLs) as such companies generally struggle to maintain production. BP’s output has now taken it to within sight of its 1972 production peak, which it is believed it may regain by 2008. Petroleum Review is indebted to Evaluate Energy for the oil and gas company production data presented in Table 1 and for checking Petroleum Review’s calculations in the preparation of this article.
Quite remarkably, in the first half of 2005 the top five, the top ten and the top 22 publicly quoted oil companies all produced less crude andNGLs than they did in 2004 and only slightly more than they did in 2003 and 2002. Given the global increase in production and demand over the last three years (see Table 2) it is clear that, in aggregate, the largest private oil companies are losing market share. For ten of the top 22 companies, and for four out of the five largest private companies, the first half of 2005 saw lower crude and NGLs production than in 2004. Ten companies also produced less in first half 2005 than they did in 2003, while nine companies produced less than in 2002.Clearly, it is no exaggeration to say that the world’s largest publicly quoted oil companies are now really struggling to hold production levels, with only a few managing to maintain their market share of global production (see Table 2).
In terms of gas production, the picture is somewhat better, but hardly very positive. In terms of first half 2005 versus the 2004, 2003 and 2002, collectively only the five largest companies have experienced production declines, with the ten and 22 largest companies registering small collective increases – although less than required to hold market share.
In terms of 1H2005 gas production versus 2004, eight companies also recorded declines, with six registering declines in both periods. Versus 2002, the first half of 2005 saw nine companies registering declines. ExxonMobil, Chevron, Anadarko and Marathon recorded declines in all three periods. Notably, large falls were recorded by Anadarko, Marathon and, to a lesser extent, Chevron. Notable gains were recorded by Kerr-McGee, EOG Resources, Statoil and BG, with somewhat smaller gains from EnCana, Repsol YPF, Occidental, Apache and BHP Billiton. It is notable, however, that output gains appear to be slowing – even among those companies recording production gains.
While less clear than for gas, the tendency for production growth to be slowing or for production loss to be accelerating is seen for crude and NGLs production. Over the period under consideration (2002–2005), notable oil company crude and NGLs production loss was seen by BHP Billiton, Repsol YPF, Statoil, Shell and Chevron. Consistent production gains over the period were seen from EOG Resources, BG, Burlington, Unocal, Apache and Eni, while for BP and ConocoPhillips, gains have slowed notably over the last year or so. (See Table 1.)
Future challenge
Perhaps the most important question to attempt to answer is the likely underlying decline rate of oil companies’ production. Quite limited numbers of projects come onstream between the fourth quarter and the first quarter – winter being a difficult time to start up offshore projects and most new production is coming from offshore. This means that production changes in this period give some indication of underlying decline rates (although there are always special circumstances to be taken into consideration). Looking at the percentage change between 4Q2004 and 1Q2005, as shown in the final column of Table 1, some of these are extremely high. Equally, there are spectacular gains for some companies. The movements for gas are notably larger (in both directions) than for crude and NGLs. Given that a 2% decline a quarter, if sustained, represents an annual decline of 8%, and that nine of the top 22 companies are showing declines of over 2% in 4Q2004/1Q2005 the challenge is easily apparent.
Clearly, maintaining production flows is becoming a struggle for many companies. New large projects are tabulated on pXX. This shows that in the period to 2010 gross production flows of 16.6mn b/d will be added by megaprojects. All new projects with peaks of over 60,000 b/d are tabulated. The net addition, however, will be much lower as more and more of the new flows are pre-empted to offset underlying production declines (see p36).
By matching the startup of new projects in late 2004/early 2005, it can be seen that new startups boosted production for BP (Holstein, Clair South, Mad Dog), Eni (Elephant build up) and Total (Hamaca). The BP experience is, however, sobering – despite bringing onstream Holstein (100,000 b/d peak) and Mad Dog (80,000 b/d peak), and getting smaller additions from Clair South, BP’s production only managed to grow by 2.46% between the quarters.
The fact that BP was the only one of the top five mega-majors to grow production at all in the period vividly illustrates the production problem the world now faces. In fact, in the 4Q2004/1Q2005 period, only three – Eni, ConocoPhillips and BP – out of the top 11 publicly quoted oil companies grew production.
In terms of volumes produced, an overall decline in the period was seen by the top five (–1.52%), top ten (–0.75%) and top 22 (–0.65%). This contrasts sharply with the solid gains in gas output over the same period – top five (+4.91%), top ten (+5.09%) and top 22 (+4.26%).
For the moment, the larger problem and challenge appears to be crude and liquids production rather than gas production.
| Table 1: Annual and quarterly production of oil and gas by publicly quoted oil companies Source: Evaluate Energy, calcultions by Petroleum Review |
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| Oil/NGL Output by Company (000 b/d) | 2002 Avg | 2003 Avg | 2004 1st Qtr | 2004 2nd Qtr | 2004 3rd Qtr | 2004 4th Qtr | 2004 Average | 2005 1st Qtr | 2005 2nd Qtr |
| BP (IFRS) | 2,018.3 | 2,120.5 | 2,533.0 | 2,518.0 | 2,479.0 | 2,593.0 | 2,530.8 | 2,593.0 | 2,619.0 |
| ExxonMobil | 2,496.5 | 2,515.3 | 2,635.0 | 2,581.0 | 2,506.0 | 2,565.0 | 2,571.8 | 2,543.0 | 2,466.0 |
| Royal Dutch Shell (IFRS) | 2,371.3 | 2,378.8 | 2,332.0 | 2,238.0 | 2,279.0 | 2,163.0 | 2,253.0 | 2,144.0 | 2,168.0 |
| Chevron | 1,896.8 | 1,807.8 | 1,756.0 | 1,749.0 | 1,678.0 | 1,656.0 | 1,709.8 | 1,647.0 | 1,649.0 |
| Total (IFRS) | 1,588.8 | 1,661.0 | 1,723.0 | 1,698.0 | 1,674.0 | 1,684.0 | 1,694.8 | 1,657.0 | 1,630.0 |
| ENI (IFRS) | 921.0 | 980.8 | 1,016.0 | 1,026.0 | 1,003.0 | 1,090.0 | 1,033.8 | 1,100.0 | 1,107.0 |
| ConocoPhillips | 735.0 | 1,022.5 | 1,040.0 | 1,012.0 | 953.0 | 1,036.0 | 1,010.3 | 1,050.0 | 1,004.0 |
| Statoil (USGAAP) | 750.0 | 747.3 | 771.0 | 730.0 | 671.0 | 728.0 | 725.0 | 708.0 | 687.0 |
| Repsol–YPF (IFRS) | 584.2 | 594.3 | 579.7 | 575.6 | 564.9 | 549.5 | 567.4 | 542.1 | 541.0 |
| Occidental | 387.5 | 419.0 | 441.0 | 440.0 | 431.0 | 427.0 | 434.8 | 427.0 | 416.0 |
| Devon Energy Corp. | 167.5 | 228.6 | 295.9 | 274.7 | 276.4 | 269.3 | 279.1 | 264.5 | 257.1 |
| Amerada Hess | 324.8 | 259.3 | 246.0 | 251.0 | 237.0 | 250.0 | 246.0 | 258.0 | 258.0 |
| Apache Corp. | 161.5 | 214.3 | 228.3 | 234.8 | 252.8 | 253.4 | 242.3 | 252.1 | 253.5 |
| EnCana | 0.0 | 226.9 | 260.3 | 269.8 | 261.1 | 235.7 | 256.7 | 232.9 | 230.8 |
| Anadarko Petroleum | 246.5 | 232.0 | 251.0 | 214.0 | 238.0 | 223.0 | 231.5 | 213.0 | 189.0 |
| Marathon | 207.1 | 193.8 | 183.9 | 178.0 | 156.6 | 162.3 | 170.2 | 163.1 | 219.1 |
| Kerr–McGee | 196.7 | 151.6 | 143.2 | 140.5 | 155.2 | 184.7 | 155.9 | 187.7 | 175.0 |
| Unocal | 166.8 | 160.5 | 157.7 | 151.1 | 154.7 | 170.5 | 158.5 | 169.0 | 176.9 |
| Burlington Resources Inc. | 109.3 | 111.2 | 149.3 | 143.2 | 151.6 | 157.6 | 150.4 | 158.3 | 161.7 |
| BHP Billiton | 231.7 | 198.1 | 187.4 | 180.6 | 178.4 | 168.6 | 178.8 | 156.2 | 152.9 |
| BG (IFRS) | 114.8 | 117.5 | 123.1 | 120.9 | 121.7 | 147.8 | 128.4 | 137.8 | 141.8 |
| EOG Resources | 26.9 | 25.9 | 30.6 | 32.3 | 33.0 | 29.9 | 31.5 | 36.3 | 37.6 |
| Total Top Five | 10,538.3 | 10,643.8 | 11,136.7 | 10,935.1 | 10,770.7 | 10,831.5 | 10,918.5 | 10,753.0 | 10,708.9 |
| Total Top Ten | 14,448.3 | 14,407.6 | 14,984.4 | 14,718.7 | 14,393.6 | 14,662.0 | 14,689.7 | 14,580.1 | 14,463.9 |
| Total Top 22 | 16,401.8 | 16,527.4 | 17,241.1 | 16,909.6 | 16,610.1 | 16,914.8 | 16,918.9 | 16,808.9 | 16,717.3 |
| Natural Gas Output by Company (mn cf/d) | 2002 Average | 2003 Average | 2004 1st Qtr | 2004 2nd Qtr | 2004 3rd Qtr | 2004 4th Qtr | 2004 Average | 2005 1st Qtr | 2005 2nd Qtr |
| ExxonMobil | 10,455.3 | 10,127.5 | 11,488.0 | 9,061.0 | 8,428.0 | 10,430.0 | 9,851.8 | 10,753.0 | 8,686.0 |
| Royal Dutch Shell (IFRS) | 9,426.0 | 8,856.0 | 10,045.0 | 7,773.0 | 7,706.0 | 9,710.0 | 8,808.5 | 9,875.0 | 7,875.0 |
| BP (IFRS) | 8,707.8 | 8,614.3 | 8,600.0 | 8,425.0 | 8,275.0 | 8,714.0 | 8,503.5 | 8,745.0 | 8,661.0 |
| Total (IFRS) | 4,528.0 | 4,786.0 | 4,951.0 | 4,915.0 | 4,386.0 | 5,323.0 | 4,893.8 | 4,945.0 | 4,797.0 |
| Chevron | 4,377.3 | 4,293.0 | 4,257.0 | 4,125.0 | 3,727.0 | 3,725.0 | 3,958.5 | 3,755.0 | 3,772.0 |
| Repsol–YPF (IFRS) | 2,495.4 | 3,225.2 | 3,271.2 | 3,621.6 | 3,875.4 | 3,591.6 | 3,590.0 | 3,537.6 | 3,828.0 |
| ENI (IFRS) | 3,304.5 | 3,486.0 | 3,672.0 | 3,570.0 | 3,252.0 | 3,684.0 | 3,544.5 | 3,618.0 | 3,708.0 |
| ConocoPhillips | 2,040.8 | 3,522.5 | 3,424.0 | 3,303.0 | 3,183.0 | 3,360.0 | 3,317.5 | 3,300.0 | 3,198.0 |
| EnCana | 2,888.0 | 2,566.3 | 2,712.0 | 3,037.0 | 3,128.0 | 3,113.0 | 2,997.5 | 3,119.0 | 3,212.0 |
| Statoil (USGAAP) | 1,947.0 | 1,999.5 | 2,472.0 | 2,052.0 | 1,758.0 | 2,844.0 | 2,281.5 | 2,886.0 | 2,646.0 |
| Devon Energy Corp. | 2,103.7 | 2,364.7 | 2,441.4 | 2,454.9 | 2,414.1 | 2,420.7 | 2,432.8 | 2,375.1 | 2,295.6 |
| BG (IFRS) | 1,548.2 | 1,858.7 | 1,958.2 | 1,991.2 | 1,858.7 | 2,047.8 | 1,964.0 | 2,086.7 | 2,090.1 |
| Burlington Resources Inc. | 1,917.0 | 1,899.3 | 1,953.0 | 1,899.0 | 1,906.0 | 1,900.0 | 1,914.5 | 1,896.0 | 1,909.0 |
| Unocal | 1,819.0 | 1,728.3 | 1,507.5 | 1,514.1 | 1,511.2 | 1,543.7 | 1,519.1 | 1,559.7 | 1,690.4 |
| Anadarko Petroleum | 1,760.5 | 1,761.5 | 1,723.0 | 1,786.0 | 1,813.0 | 1,641.0 | 1,740.8 | 1,454.0 | 1,434.0 |
| Apache Corp. | 1,080.5 | 1,216.6 | 1,212.8 | 1,250.9 | 1,233.7 | 1,243.1 | 1,235.1 | 1,259.3 | 1,296.6 |
| EOG Resources | 963.0 | 955.0 | 975.0 | 978.0 | 1,045.0 | 1,143.0 | 1,035.3 | 1,163.0 | 1,182.0 |
| Kerr–McGee | 760.0 | 724.8 | 763.0 | 740.0 | 1,051.0 | 1,125.0 | 919.8 | 1,104.0 | 1,118.0 |
| Marathon | 1,230.7 | 1,170.8 | 1,136.3 | 964.9 | 901.2 | 996.4 | 999.7 | 1,025.5 | 892.6 |
| BHP Billiton | 776.4 | 770.3 | 926.0 | 843.2 | 840.3 | 935.3 | 886.2 | 839.0 | 949.5 |
| Occidental | 627.0 | 605.8 | 613.0 | 642.0 | 649.0 | 644.0 | 637.0 | 662.0 | 681.0 |
| Amerada Hess | 754.8 | 682.8 | 602.0 | 601.0 | 516.0 | 576.0 | 573.8 | 604.0 | 575.0 |
| Total Top Five | 41,515.0 | 40,940.7 | 43,735.4 | 38,652.9 | 36,842.1 | 42,222.7 | 40,363.3 | 42,344.1 | 37,995.6 |
| Total Top Ten | 59,590.3 | 60,924.7 | 64,281.4 | 59,075.5 | 57,195.9 | 64,267.4 | 61,205.1 | 64,318.9 | 60,151.6 |
| Total Top 22 | 76,760.8 | 76,663.1 | 80,092.6 | 74,740.7 | 72,935.1 | 80,483.4 | 77,062.9 | 80,347.1 | 76,265.4 |
| Oil/NGL Output by Company (000 b/d) | 1H2005 Average | % change 1H2005 v 2004 | % change 1H2005 v 2003 | % change 1H2005 v 2002 | % change 1Q2005 v 4Q2004 |
| BP (IFRS) | 2,606.0 | 2.97 | 22.90 | 29.12 | 2.46 |
| ExxonMobil | 2,504.5 | –2.61 | –0.43 | 0.32 | –1.12 |
| Royal Dutch Shell (IFRS) | 2,156.0 | –4.31 | –9.36 | –9.08 | –4.84 |
| Chevron | 1,648.0 | –3.61 | –8.84 | –13.11 | –3.67 |
| Total (IFRS) | 1,643.5 | –3.02 | –1.05 | 3.45 | –2.23 |
| ENI (IFRS) | 1,103.5 | 6.75 | 12.52 | 19.82 | 6.41 |
| ConocoPhillips | 1,027.0 | 1.66 | 0.44 | 39.73 | 3.93 |
| Statoil (USGAAP) | 697.5 | –3.79 | –6.66 | –7.00 | –2.34 |
| Repsol–YPF (IFRS) | 541.6 | –4.56 | –8.88 | –7.30 | –4.46 |
| Occidental | 421.5 | –3.05 | 0.60 | 8.77 | –1.78 |
| Devon Energy Corp. | 260.8 | –6.54 | 14.08 | 55.67 | –5.22 |
| Amerada Hess | 258.0 | 4.88 | –0.48 | –20.55 | 4.88 |
| Apache Corp. | 252.8 | 4.32 | 17.96 | 56.57 | 4.02 |
| EnCana | 231.8 | –9.70 | 2.15 | – | –9.29 |
| Anadarko Petroleum | 201.0 | –13.17 | –13.36 | –18.46 | –7.99 |
| Marathon | 191.1 | 12.28 | –1.38 | –7.73 | –4.17 |
| Kerr–McGee | 181.4 | 16.32 | 19.60 | –7.78 | 20.40 |
| Unocal | 173.0 | 9.12 | 7.74 | 3.69 | 6.62 |
| Burlington Resources Inc. | 160.0 | 6.37 | 43.88 | 46.39 | 5.24 |
| BHP Billiton | 154.5 | –13.54 | –21.99 | –33.31 | –12.61 |
| BG (IFRS) | 139.8 | 8.87 | 18.92 | 21.77 | 7.32 |
| EOG Resources | 37.0 | 17.49 | 42.66 | 37.23 | 15.42 |
| Total Top Five | 10,731.0 | –1.72 | 0.82 | 1.83 | –1.52 |
| Total Top Ten | 14,522.0 | –1.14 | 0.79 | 0.51 | –0.75 |
| Total Top 22 | 16,763.1 | –0.92 | 1.43 | 2.20 | –0.65 |
| Natural Gas Output by Company (mn cf/d) | 1H2005 Average | % chnge 1H2005 v 2004 | % chnge 1H2005 v 2003 | % chnge 1H2005 v 2002 | % chnge 1Q2005 v 4Q2004 |
| ExxonMobil | 9,719.5 | –1.34 | –4.03 | –7.04 | 9.15 |
| Royal Dutch Shell (IFRS) | 8,875.0 | 0.75 | 0.21 | –5.85 | 12.11 |
| BP (IFRS) | 8,703.0 | 2.35 | 1.03 | –0.05 | 2.84 |
| Total (IFRS) | 4,871.0 | –0.46 | 1.78 | 7.58 | 1.05 |
| Chevron | 3,763.5 | –4.93 | –12.33 | –14.02 | –5.14 |
| Repsol–YPF (IFRS) | 3,682.8 | 2.59 | 14.19 | 47.58 | –1.46 |
| ENI (IFRS) | 3,663.0 | 3.34 | 5.08 | 10.85 | 2.07 |
| ConocoPhillips | 3,249.0 | –2.06 | –7.76 | 59.21 | –0.53 |
| EnCana | 3,165.5 | 5.60 | 23.35 | 9.61 | 4.05 |
| Statoil (USGAAP) | 2,766.0 | 21.24 | 38.33 | 42.06 | 26.50 |
| Devon Energy Corp. | 2,335.4 | –4.01 | –1.24 | 11.01 | –2.37 |
| BG (IFRS) | 2,088.4 | 6.33 | 12.35 | 34.89 | 6.25 |
| Burlington Resources Inc. | 1,902.5 | –0.63 | 0.17 | –0.76 | –0.97 |
| Unocal | 1,625.1 | 6.97 | –5.97 | –10.66 | 2.67 |
| Anadarko Petroleum | 1,444.0 | –17.05 | –18.02 | –17.98 | –16.47 |
| Apache Corp. | 1,278.0 | 3.47 | 5.05 | 18.27 | 1.96 |
| EOG Resources | 1,172.5 | 13.26 | 22.77 | 21.75 | 12.34 |
| Kerr–McGee | 1,111.0 | 20.79 | 53.29 | 46.18 | 20.03 |
| Marathon | 959.1 | –4.07 | –18.09 | –22.07 | 2.58 |
| BHP Billiton | 894.2 | 0.91 | 16.09 | 15.17 | –5.32 |
| Occidental | 671.5 | 5.42 | 10.85 | 7.10 | 3.92 |
| Amerada Hess | 589.5 | 2.75 | –13.66 | –21.89 | 5.27 |
| Total Top Five | 40,169.9 | –0.48 | –1.88 | –3.24 | 4.91 |
| Total Top Ten | 62,235.3 | 1.68 | 2.15 | 4.44 | 5.09 |
| Total Top 22 | 78,306.3 | 1.61 | 2.14 | 2.01 | 4.26 |
| 2002 | 2003 | 2004 | |
| Global oil production gain | -0.7% | 3.8% | 4.5% |
| Global oil demand gain | 0.1% | 2.1% | 3.4% |
| Global gas production gain | 1.4% | 3.4% | 2.8% |
| Global gas demand gain | 2.8% | 2.0% | 3.3% |
|
Source: BP Statistical Review, June 2005, June 2004 and June 2003 | |||
The period covered from 1Q2002 to date is used because virtually all companies are broadly the same over the period. BP, EnCana, Kerr-McGee and Anadarko data all modified by acquisitions/rationalisations
Oil and NGLs
- Shell – numbers include Canadian oil sands production from 2003.
- ConocoPhillips – in 2002, Phillips numbers only; 2003 onwards includes syncrude data.
- EnCana – compiled under US protocols (different to annual reports).
- Shell – 2002 and 1H2003 restated.
- Repsol YPF, Eni and Statoil – all report gas in boe, these figures converted to gas at 6,000 cf to 1 boe ratio.
- EnCana – compiled under US protocols.
