BP
BP p.l.c. is a British multinational oil and gas company headquartered in London, England. It is one of the oil and gas "supermajors" and one of the world's largest companies measured by revenues and profits.
It is a vertically integrated company operating in all areas of the oil and gas industry, including exploration and extraction, refining, distribution and marketing, power generation, and trading.
BP's origins date back to the founding of the Anglo-Persian Oil Company in 1909, established as a subsidiary of the Burmah Oil Company to exploit oil discoveries in Iran. In 1935, it became the Anglo-Iranian Oil Company and in 1954, adopted the name British Petroleum.
BP acquired majority control of Standard Oil of Ohio in 1978. Formerly majority state-owned, the British government privatised the company in stages between 1979 and 1987. BP merged with Amoco in 1998, becoming BP Amoco p.l.c., and acquired ARCO, Burmah Castrol and Aral AG shortly thereafter. The company's name was shortened to BP p.l.c. in 2001.
, BP had operations in 61 countries, produced around of oil equivalent, and had total proven reserves of of oil equivalent. The company has around 21,200 service stations worldwide, which it operates under the BP brand and under the Amoco brand and the Aral brand. Its largest division is BP America in the United States.
BP is the fifth-largest investor-owned oil company in the world by 2024 revenues. BP had a market capitalisation of US$98.36 billion as of 2022, placing it 122nd in the world, and its Fortune Global 500 rank was 33rd in 2024 with revenues of US$194.6 billion. The company's primary stock listing is on the London Stock Exchange, where it is a member of the FTSE 100 Index.
BP has been directly involved in several major environmental and safety incidents. Among them were the 2005 Texas City refinery explosion, which caused the death of 15 workers and which resulted in a record-setting OSHA fine; Britain's largest oil spill, the wreck of Torrey Canyon in 1967; and the 2006 Prudhoe Bay oil spill, the largest oil spill on Alaska's North Slope, which resulted in a US$25 million civil penalty, the largest per-barrel penalty at that time for an oil spill.
BP's worst environmental catastrophe was the 2010 Deepwater Horizon oil spill, the largest accidental release of oil into marine waters in history, which leaked about of oil, causing severe environmental, human health, and economic consequences and serious legal and public relations repercussions for BP, costing more than $4.5 billion in fines and penalties, and an additional $18.7 billion in Clean Water Act-related penalties and other claims, the largest criminal resolution in US history. Altogether, the oil spill cost the company more than $65 billion.
History
1909 to 1954
In May 1908, a group of British geologists discovered a large amount of oil at Masjed Soleyman located in the Khuzestan Province in the southwest of Persia. It was the first commercially significant find of oil in the Middle East. William Knox D'Arcy, by contract with Ali-Qoli Khan Bakhtiari, obtained permission to explore for oil for the first time in the Middle East, an event which changed the history of the entire region. The oil discovery led to petrochemical industry development and also the establishment of industries that strongly depended on oil. On 14 April 1909, the Anglo-Persian Oil Company was incorporated as a subsidiary of Burmah Oil Company. Some of the shares were sold to the public. The first chairman and minority shareholder of the company became Lord Strathcona.Immediately after establishing the company, the British government asked Percy Cox, British resident to Bushehr, to negotiate an agreement with Sheikh Khaz'al Ibn Jabir of Arabistan for APOC to obtain a site on Abadan Island for a refinery, depot, storage tanks, and other operations. The refinery was built and began operating in 1912. In 1914, the British government acquired a controlling interest in the company, at the urging of Winston Churchill, the then First Lord of the Admiralty, and the British navy quickly switched from coal to oil for the majority of their war ships. APOC also signed a 30-year contract with the British Admiralty for supplying oil for the Royal Navy at the fixed price. In 1915, APOC established its shipping subsidiary the British Tanker Company and in 1916, it acquired the British Petroleum Company which was a marketing arm of the German Europäische Petroleum Union in Britain. In 1919, the company became a shale-oil producer by establishing a subsidiary named Scottish Oils which merged remaining Scottish oil-shale industries.
After World War I, APOC started marketing its products in Continental Europe and acquired stakes in the local marketing companies in several European countries. Refineries were built in Llandarcy in Wales and Grangemouth in Scotland. It also acquired the controlling stake in the Courchelettes refinery in France and formed, in conjunction with the Government of Australia, a partnership named Commonwealth Oil Refineries, which built the Australian's first refinery in Laverton, Victoria. In 1923, Burmah employed Winston Churchill as a paid consultant to lobby the British government to allow APOC have exclusive rights to Persian oil resources, which were subsequently granted by the Iranian monarchy.
APOC and the Armenian businessman Calouste Gulbenkian were the driving forces behind the creation of Turkish Petroleum Company in 1912, to explore oil in Mesopotamia ; and by 1914, APOC held 50% of TPC shares. In 1925, TPC received concession in the Mesopotamian oil resources from the Iraqi government under British mandate. TPC finally struck oil in Iraq on 14 October 1927. By 1928, the APOC's shareholding in TPC, which by now was named Iraq Petroleum Company, was reduced to 23.75%; as the result of the changing geopolitics post Ottoman Empire break-up, and the Red Line Agreement. Relations were generally cordial between the pro-west Hashemite Monarchy in Iraq and IPC, in spite of disputes centred on Iraq's wish for greater involvement and more royalties. During the 1928–68 time period, IPC monopolised oil exploration inside the Red Line; excluding Saudi Arabia and Bahrain.
In 1927, Burmah Oil and Royal Dutch Shell formed Burmah-Shell, a joint marketing company. In 1928, APOC and Shell formed the Consolidated Petroleum Company for sale and marketing in Cyprus, South Africa and Ceylon, which in 1932 followed by a joint marketing company Shell-Mex and BP in the United Kingdom. In 1937, AIOC and Shell formed the Shell/D'Arcy Exploration Partners partnership to explore for oil in Nigeria. The partnership was equally owned but operated by Shell. It was later replaced by Shell-D'Arcy Petroleum Development Company and Shell-BP Petroleum Development Company.
In 1934, APOC and Gulf Oil founded the Kuwait Oil Company as an equally owned partnership. The oil concession rights were awarded to the company on 23 December 1934 and the company started drilling operations in 1936. In 1935, Reza Shah requested the international community to refer to Persia as 'Iran', which was reflected in the name change of APOC to the Anglo-Iranian Oil Company.
In 1937, Iraq Petroleum Company, 23.75% owned by BP, signed an oil concession agreement with the Sultan of Muscat that covers the entire region of the Sultanate, which was in fact limited to the coastal area of present-day Oman. After several years of failure to discover oil in the Sultanate's region, IPC presumed that oil was more likely to be found in the interior region of Oman, which was part of the Imamate of Oman. IPC offered financial support to raise an armed force that would assist the Sultanate in occupying the interior region of Oman. Later, in 1954, the Sultan of Muscat, backed by the British government and the financial aid he received from IPC, started occupying regions within the interior of Oman, which led to the outbreak of Jebel Akhdar War that lasted for more than 5 years.
In 1947, British Petroleum Chemicals was incorporated as a joint venture of AIOC and The Distillers Company. In 1956, the company was renamed British Hydrocarbon Chemicals.
Following World War II, nationalistic sentiments were on the rise in the Middle East; most notable being Iranian nationalism, and Arab Nationalism. In Iran, the AIOC and the pro-western Iranian government led by Prime Minister Ali Razmara resisted nationalist calls to revise AIOC's concession terms in Iran's favour. In March 1951, Razmara was assassinated and Mohammed Mossadeq, a nationalist, was elected as the new prime minister by the Majlis of Iran. In April 1951, the Iranian government nationalised the Iranian oil industry by unanimous vote, and the National Iranian Oil Company was formed, displacing the AIOC. The AIOC withdrew its management from Iran, and Britain organised an effective worldwide embargo of Iranian oil. The British government, which owned the AIOC, contested the nationalisation at the International Court of Justice at The Hague, but its complaint was dismissed.
Prime Minister Churchill asked President Eisenhower for help in overthrowing Mossadeq. The anti-Mossadeq plan was orchestrated under the code-name 'Operation Ajax' by CIA, and 'Operation Boot' by SIS. The CIA and the British helped stage a coup in August 1953, the 1953 Iranian coup d'état, which established pro-Western general Fazlollah Zahedi as the new PM, and greatly strengthened the political power of Shah Mohammad Reza Pahlavi. The AIOC was able to return to Iran.
1954 to 1979
In 1954, the AIOC became the British Petroleum Company. After the 1953 Iranian coup d'état, Iranian Oil Participants Ltd, a holding company, was founded in October 1954, in London to bring Iranian oil back to the international market. British Petroleum was a founding member of this company with 40% stake. IOP operated and managed oil facilities in Iran on behalf of NIOC. Similar to the Saudi-Aramco "50/50" agreement of 1950, the consortium agreed to share profits on a 50–50 basis with Iran, "but not to open its books to Iranian auditors or to allow Iranians onto its board of directors."In 1953, British Petroleum entered the Canadian market through the purchase of a minority stake in Calgary-based Triad Oil Company, and expanded further to Alaska in 1959, resulting discovery of oil at Prudhoe Bay in 1969. In 1956, its subsidiary D'Arcy Exploration Co. Ltd. was granted four oil concessions in Libya. In 1962, Scottish Oils ceased oil-shale operations. In 1965, it was the first company to strike oil in the North Sea. In 1969, BP entered the United States by acquiring the East Coast refining and marketing assets of Sinclair Oil Corporation. The Canadian holding company of British Petroleum was renamed BP Canada in 1969; and in 1971, it acquired 97.8% stake of Supertest Petroleum.
By the 1960s, British Petroleum had developed a reputation for taking on the riskiest ventures. It earned the company massive profits; it also earned them the worst safety record in the industry. In 1967, the giant oil tanker Torrey Canyon foundered off the English coast. Over of crude oil was spilled into the Atlantic and onto the beaches of Cornwall and Brittany, causing Britain's worst-ever oil spill. The ship was owned by the Bahamas-based Barracuda Tanker Corporation and was flying the flag of Liberia, a well-known flag of convenience, but was being chartered by British Petroleum. The ship was bombed by RAF jet bombers in an effort to break up the ship and burn off the leaking oil, but this failed to destroy the oil slick.
In 1967, BP acquired chemical and plastics assets of The Distillers Company which were merged with British Hydrocarbon Chemicals to form BP Chemicals.
The company's oil assets were nationalised in Libya in 1971, in Kuwait in 1975, and in Nigeria in 1979. In Iraq, IPC ceased its operations after it was nationalised by the Ba'athist Iraqi government in June 1972, although legally Iraq Petroleum Company still remains in existence but as a dormant company, and one of its associated companies —Abu Dhabi Petroleum Company, formerly Petroleum Development Ltd – also continues with the original shareholding intact.
The intensified power struggle between oil companies and host governments in Middle East, along with the oil price shocks that followed the 1973 oil crisis meant British Petroleum lost most of its direct access to crude oil supplies produced in countries that belonged to the Organization of Petroleum Exporting Countries, and prompted it to diversify its operations beyond the heavily Middle East dependent oil production. In 1976, BP and Shell de-merged their marketing operations in the United Kingdom by dividing Shell-Mex and BP. In 1978, the company acquired a controlling interest in Standard Oil of Ohio.
In Iran, British Petroleum continued to operate until the Islamic Revolution in 1979. The new regime of Ayatollah Khomeini nationalised all of the company's assets in Iran without compensation: as a result, BP lost 40% of its global crude oil supplies.
In 1970–1980s, BP diversified into coal, minerals and nutrition businesses which all were divested later.