BP's Sustainability Strategies

This assignment delves into British Petroleum's (BP) sustainability initiatives. It examines the company's implementation of carbon capture and underground storage (CCS) technology, a key strategy for mitigating climate change. Additionally, it explores BP's strategic responses to imposed innovation projects, particularly in the context of carbon capture and storage within the Alberta oil sands industry. The analysis draws upon various sources, including academic research, company reports, and online publications.

The Future of Oil And Gas
Industry

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................2
Selection of oil and gas company...........................................................................................2
TASK 2............................................................................................................................................2
2.A. Strategy and Ethos of British Petroleum company.........................................................2
2.B. Future outlook related to energy provision as well as diversification............................3
2.C. New technology as well as new frontiers.......................................................................4
2.D. Corporate social responsibilities.....................................................................................6
2.E. Attitude towards climate change or carbon collection, storage etc. ...............................6
TASK 3............................................................................................................................................9
Producing SWOT on the basis of the above analysis.............................................................9
TASK 4 .........................................................................................................................................12
Providing a concise summary and assessment of the future diagnosis of British Petroleum.12
REFERENCES..............................................................................................................................14

INTRODUCTION
Oil and gas industry is one of the fastest growing sector in the world which makes
huge contribution in the growth rate of an economy. There are several firms have the
great presence in this specific segment and provide products like oil and gas to customers
worldwide. For the present project, British Petroleum (BP) company is considered which
operates in the oil and gas as well as energy sector. Further, it is a multinational public
limited organisation and sixth largest entity in the oil and gas sector. The study shows
strategies and ethos, beliefs, ethics etc. of BP firm. Further, its future outlook, new
technologies, frontiers as well as CSR activities are critically evaluated in the current
assignment with reference to British Petroleum company. Apart from this, attitude of
selected enterprise towards the climate change and storage are criticised in proper
direction. At the end of study, SWOT model is produced which helps to assess strengths,
weaknesses, opportunities and threats of British Petroleum firm.
1

TASK 1
Selection of oil and gas company
In the oil and gas sector, several numbers of businesses operate and provide
relevant products and service to the customers. In order to complete the present report the
British Petroleum enterprise is selected which has the great presence across the world. It
is a public limited firm and comes at the sixth largest entity in the oil and gas sector in the
world. Further, its financial position is also strong due to using highly effectual strategies
and tactics while operating in the selected sector. Subsidiary company of BP is Amoco
also has the high level of presence in the market. Apart from this, basic products provided
by it are like petroleum, motor fuels, natural gas, aviation fuels and petrochemicals (BP
at a glance, 2017). Number of people working in this firm worldwide are 74500 as per
the survey of financial year 2016.
TASK 2
2.A. Strategy and Ethos of British Petroleum company
Being a multinational as well as sixth largest firm of oil and gas industry, it uses
wide range of effectual strategies and techniques at the workplace. These help to BP for
taking out required minerals like digging in sea surfaces, refine it and sale up to the
customers. Along with the strategies, management of British Petroleum is highly
concerned towards the ethos, beliefs as well as ethics up to the greater extent. The reason
is that, until and unless an enterprise not goes through essential ethics then sometimes
affect adversely (Annual report of British Petroleum 2016, 2017). Therefore, employees
not give better response and efficiency of them also affected at the greater level.
Refreshed strategy incorporated by British Petroleum as of now is 'good for all seasons'
in any kind of environment whether it is certain or uncertain. This tactic is used by BP
because of helping to gain competitive advantages in the world in terms of prices,
customer preferences and lower carbon. It uses the cost management strategy which helps
to reduce total cost of refining and selling in the market. Further, considers tactic for
boosting up the supply using effectual instruments. On the basis of this, it will become

capable for providing the oil and gas products at the lowest prices up to the customers.
Apart from this, BP test its investment against to range of oil and gas prices which helps
to analyse profitability position for the long-term (Kelland, 2014). Therefore,
management can make attractive as well as profitable pricing decisions.
When looking at the ethical aspects then British Petroleum is highly concerned for
this element in the business environment. Very basic ethical factors used by this is that,
without using all the safety equipments it not allows employees to work at the workplace.
This technique clearly indicates that it has high level of beliefs towards the workers.
Further, it considers two independent monitors which are like process safety and ethics
monitors. Along with employees, it uses ethics towards the environment and sea animals
in higher level (Finšgar and Jackson, 2014). In context to this, it reached in FY 2014 up
to the Environmental Protection Agency and follows all the norms and laws of that to
protect environment.
However, it can be criticised that when British Petroleum enterprise misconduct to
the ethos and breach any of the laws, rules or regulations related to ethics then its
reputation, brand image and goodwill affects adversely in oil and gas industry. Along
with this, operations results or outcomes, value of shareholder and licence to operate in
this sector will also influence negatively (Yusuf and et.al., 2014).
2.B. Future outlook related to energy provision as well as diversification
From the last many years the oil and gas industry grown in positive direction with
better rates. On the basis of this it is expected that British Petroleum company will grow
in the future and generate huge profit. In context to this, it is going to explore a strong
pipeline in many countries which will be supportive for the firm, industry as well as
society. In context to the business, it will grow in terms of profit or sales along with
enhance brand image. As firm grows positively then overall industry also affect in same
direction. Being a multinational firm it will be highly effectual for the worldwide oil and
gas industry. Apart from this, in the future also it will continue with its old costing and
pricing strategies which will help to people for purchasing oil and gas at the lower costs

(Yusuf and et.al., 2013). British Petroleum is going to expand gas portfolio where energy
provisions will affect positively in the worldwide. The reason behind this is that, in the
upcoming years demand of energy will grow up to the greater level across the globe.
Under the energy provision it will consider fossil fuels as well as renewable which will
be provided at the lowest prices. Moreover, BP company will be at a glance and on the
path of most likely from energy products until the year 2035 (BP Energy Outlook, 2017).
Therefore, sales and profit will give high level of positive response towards the British
Petroleum.
As per the diversification, it has opportunity to tie up oil and gas firms of the
emerging countries. The reason is that, such economies concerned towards the pricing
aspect majorly and BP firm already charges the lowest cost from the customers. In
addition to this, it is going to explore pipelines which is one kind of diversification in
another regions or nations. Hence, it can be evaluated that future of British Petroleum in
terms of diversification is very bright and profitable.
However, at the time of diversifying in any another country the company has to
consider or follow rules as well as regulations of the economy where it enters. Due to this
particular situation, it may be possible that British Petroleum unable to apply each and
every laws and acts of new market (Kilian and Murphy, 2014). Therefore, in the future
smooth business system can be affected adversely. Being the 3rd largest firm of energy
sector it has to provide several allowances and benefits to the employees to keep the
brand image at higher position. When it goes with these all concepts then expenses and
profitability will also hamper. Hence, it can be said that while considering provisions
related to energy and diversification British Petroleum entity has to face some issues in
the future.
2.C. New technology as well as new frontiers
Nowadays, technical industry growing rapidly and come up with several
innovative technologies which help to the businesses for enhancing production quality.
Apart from this, as standard of the goods and service improve then enterprise easily able

to attract huge customers which is sign of generating higher incomes. The British
Petroleum uses various types of techniques in order to dig the oil wells and take out crude
oil or petrols. In this procedure when employee working then firm provides huge safety
equipments and techniques in proper manner. As per this, when IT sector launch any new
instruments or equipments to dig the oil wells then employees will be highly beneficial.
The reason is that British Petroleum will become more capable for providing huge safety
to them (Shaffer and et.al., 2013). When crude oil is taken out from the wells then firm
go for further step i.e. refining the raw materials. In the process of refining crude oils
high level of machineries, technologies and equipments are required. Moreover, as
British Petroleum entity considers new technology at the workplace then able to refine
the crude oil in proper manner. Apart from this, all the components associated with raw
materials can be easily and properly segregated using innovative technologies.
A term which refers to the separation as well as combination of the border lines of
two or more nations is known as frontier. As per the current case study, when British
Petroleum firm is going to apply new technologies then it has to deal with country where
innovative techniques are made. Therefore, its new frontier will be increased in the world
which will be highly beneficial for it. In accordance to the above analysis BP enterprise
has opportunity to expand its export market and increase production in proper way. When
it will go for the export expansion then connection with another nations will enhance.
This is indication of combining two borders which will be new frontier for this firm.
In contrary to this, when the cited firm is going to adopt new technologies and
equipments for digging the oil wells then it will impose some costs on it. Apart from this,
at the time of introducing new techniques and machineries in the refinery system of crude
oil then BP has to bear extra or additional expenses (Shukla and Karki, 2016). As the
management considers more technologies in the business environment then it will fall
under the financial burden. Therefore, it can be criticised that British Petroleum will not
able to generate more profit because some part of sales will be covered by new
techniques. When looking at the frontier then at the time of expanding export market it

has to follow rules and regulations of new country. If it not considers and follows legal
laws and legislations of exporting oil and energy resources then cannot export such items
in proper way. Due to this, new frontier will be affected in an inverse direction up to the
larger extent.
2.D. Corporate social responsibilities
An approach in which company do some activities in order to deliver economic,
environmental as well as social benefits among its stakeholders is identified as corporate
social responsibilities (CSR). These kinds of activities contribute in an organisation in
terms of sustainable development in the industry. When looking at the British Petroleum
company with reference to CSR then such activities are very less adopted by it. In terms
of social CSR it contributes in the charitable trusts where it gives financial support along
with some required things like food, cloths etc. Apart from this, it provides financials to
those people who are willing to get education but because of poor economic situation not
able to take it. Due to this, society aware about the BP firm and starts to consume
products and energy provisions from it. Being a petroleum enterprise it creates a huge
impact on the environmental factors (Dudovskiy, 2012). On the other side, it takes
various activities for protecting environment and use better equipments at the time of
digging in sea surfaces. Still taking CSR related to this specific aspect the BP company is
not able to protect environment at the satisfaction and high level.
Looking at the economic aspect then British Petroleum provides employment to
various people across the globe. Number of employee who are employed in BP firm as
per the current survey are more than 79,000. Further, amount of salary given to them is
also high and attractive along with at the satisfaction level.
2.E. Attitude towards climate change or carbon collection, storage etc.
The Carbon program in energy and environment conducted a survey of public
attitude on energy use and environment concern on over 1200 people representing the
public. In the survey there were 17 question asked to the people about the environment,
global warming and climate change mitigation technology. In this survey there was an

analysis of and response was drawn about the level of public understanding and
awareness of global climate change and carbon dioxide capture and storage and to
suggest the implication for the public (Carpenter, 2017). And the willingness of the
public to solve the global warming as an individual concerned about the environment
issue is now increasing. Global warming is the increased in global average temperature
near earth surface and is increasing the green house gases in the atmosphere. Most of the
electricity in the world is generated at large power plants which will burn coal and other
fossil fuels and thus adding large number of carbon dioxide to atmosphere.
Many of then scientists are developing the ways to store and capture carbon
dioxide from the power plants and factories and store it underground so that it can not go
into the atmosphere. It will be taking many decades to find the alternative or to produce
electricity from renewable resource which will be emitting less or no carbon dioxide
(Braun and Schmidt, 2017). How will this storage be working is the question for the
people.
 From the power plant or a factory the carbon dioxide emission would be capture
so that the gases are not released into atmosphere.
 This captured carbon dioxide is thus sent through a pipeline and placed
underground so that it could be stored safely and permanently.
 This undergrounds site is thus kept under supervision to see that there are no
leakage in the atmosphere or in the underground source of water.
There must be awareness in the public about this storage as they can also contribute
something in this process (Verbeke, Osiyevskyy and Backman, 2017). The public should
also be concern about this atmosphere degradation and the increasing gases in the
environment. Because of this the climate is also gradually changing nowadays like any
time it can rain in any part of the world, in the desert area floods are coming. These all
are the signs of climate change are very dangerous for the humans, animals, ecosystem
and environment as well and are included in the global warming. As scientists have given

the warning that these gases must be kept under control so that they are not much
harmful.
Illustration 1: Carbon Capture and
Underground Storage
[Source: Carbon Capture and
Underground Storage. 2017]

TASK 3
Producing SWOT on the basis of the above analysis
When looking at the analysis which done in the above sections then various things
can be seen with reference to British Petroleum enterprise. The framework through which
above analysis is presented is SWOT which comprises with four factors i.e. strengths,
weaknesses, opportunities as well as threats. Moreover, SWOT analysis of selected
company BP is stated below:
Illustration 2: SWOT Analysis model
(Source: Haseeb, 2015)
Strengths:
 British Petroleum is one of the biggest firm in the industry of energy which
majorly deals with energy provisions.
 In terms of generating sales and revenue the BP firm comes at the 4th number
across the world in oil and gas sector. Therefore, profitability and liquidity
position of BP is higher in the respective industry in comparison to other firms of
same sector.

 When considering to the market presence then it has the biggest geographical
reach where it covers major countries of the globe.
 It has the highest quality of operations as compared to its competitors and other
firms of same industry (Haseeb, 2015).
 BP has very trusted along with sound brand image where it is highly engaged in
order to provide resources related to energy among its customers. On the basis of
this, its brand valuation is also the highest in oil and gas segment along with
energy sector.
 Other than these, it is top in the market with reference to energy as well as oil and
gas sector.
Weaknesses:
 Major issue faced by the British Petroleum firm is related to environmental
hazards where it has to pay huge amount.
 As compared to the previous times, production of the selected company is at the
declining phase nowadays which is one of its biggest weakness.
 Moreover, many times the British Petroleum company fails in order to move
towards maturity phase of the business life-cycle in the various markets of the
globe.
Opportunities
 Key opportunity which BP firm has is to improve prices or charges of fuel and oil.
Therefore, it can boost up its overall profitability and financial performance in the
industry across the world (BP SWOT Analysis, USP & Competitors, 2016).
 Further, it can enhance market if the natural gas which lead to make business of oil
and gas strong.
 In the world, there are several wells of the oil available which are dug due to
which the firm can enhance its production of oil. On the basis of this, it can earn

huge amounts or incomes by supplying more oil products. Ultimately, chances to
enhance financial condition are available with BP firm in the future.
 The company has presence across the globe but not exporting its products and
energy resources in wide range of markets. Due to this, it has major opportunity in
order to expand export market which will be beneficial in terms of becoming
financially sound.
 Apart from the above, British Petroleum company can invest in those businesses
which are operated in another industry or alternative of it. Due to this, if it unable
to generate more benefits, then can earn from firms in which it made investment.
Therefore, easily able to meet expenses associated with oil transportation and
provide wages or salaries to its workers or staff (Ford, Steen and Verreynne,
2014).
Threats:
 Government rules and regulations imposed by the country where BP operates are
major threat for it.
 In world several firms of oil producing as well as transporting have presence
where they provide high quality of service which become great threat for the
selected company.
 Rules, laws and regulations related to environment are mandatory to follow by
British Petroleum which is another threat for it.
 Apart from this, cost of operations and production may enhance where company
cannot meet demands as well as needs of the customers properly.

TASK 4
Providing a concise summary and assessment of the future diagnosis of British
Petroleum.
Petroleum industry is one of the growing industry of world and British Petroleum
is the sixth largest oil and gas company in the world. It is growing in much higher pace
and 10 years ago this company focused at peak oil and now in the present year of 2017 its
focus is on renewable to changing demographics (Amernic and Craig, 2017). And in
future the company will be focusing in energy transition and dominant fuel, oil supply,
gas supply, growth of renewable and electrification.
 Energy Transition And Dominant Fuel- the wood was a dominant fuel for
centuries, then coal and now oil is the dominant one. In 21st century gas is now
growing faster than any other fossil fuels and renewable are still faster in this
growing world. And with all these changes British Petroleum is searching for
more and more opportunities to find new worlds in changing energy types, allied
with sharp changes in price as well (Daigneault and Bursian, 2017). In the global
agreement in the year 2015 in Paris it was agreed to keep the global temperature
rise below till 2 degree Celsius and dictate the speed of these transition.
 Oil Supply- oil is of so much use to British Petroleum and over past two decades
the energy world has affected from a position where oil supple would limit. And it
is estimated that there will be a time when the demand of oil would be at peak and
thus will gradually start decreasing. And this peak oil window will be certainly be
around 2025 and 2040 which is all uncertainty (Hassani, Silva and Al Kaabi,
2017).
 Gas Supply- as compared to oil the price of gas is very less in the global market.
And British Petroleum is ready to introduce underground carbon capture and
carbon storage very soon. This underground carbon capture and storage will be
helping the ecosystem and preventing environment from degradation. As
compared to oil the amount of natural gas in the environment is plenty. British

Petroleum is exporting the natural gas in the form of liquefied natural gas (LNG)
to greater parts of the world
 Growth Of Renewable- it has a mission for the industry as well as for ecosystem
and is increasing the use of renewable sources. Wind and solar power is the best
form of renewable resources and have been growing faster than fossil fuels and
British Petroleum is helping the world in this use.
 Electrification- there is also the higher use of electricity in the present world and
in British Petroleum as well (Walters-Davies, 2017). Which it certainly needs to
reduce and replace it with that of solar power so that use of coal is decreased to a
certain level.

REFERENCES
Journals and Books
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80.
Braun, C., and Schmidt, U., 2017. Public perception of climate engineering and carbon
capture and storage in Germany: survey evidence. Climate Policy, pp.1-14.
Carpenter, S. M., 2017. Transdisciplinarity Within the North American Climate Change
Mitigation Research Community, Specifically the Carbon Dioxide Capture,
Transportation, Utilization and Storage Community (Doctoral dissertation, California
Institute of Integral Studies).
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media for the oil and gas industry: A review. Corrosion Science. 86. pp. 17-41.
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innovation in the Australian oil and gas industry: going beyond the Porter
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Shaffer, D. L. and et.al., 2013. Desalination and reuse of high-salinity shale gas produced
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Online
<https://archive.epa.gov/climatechange/kids/solutions/technologies/ccs.html>
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and-form-20f-2016.pdf>.

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