Business briefs

BP reports loss
of $4.4 billion in 4th quarter of 2014
LONDON — Oil giant BP reported a loss Tuesday of $4.4 billion for the fourth quarter of 2014, as oil prices plunged.
The net income figure includes a $5 billion writedown on the value of BP’s inventories, after the price of Brent crude, the benchmark for North Sea oil, dropped almost 50 percent last year. BP posted a profit of $1.04 billion in the fourth quarter of 2013.
After stripping out the effect of the drop in oil prices, BP reported a loss of $969 million for the period, compared with a gain of $1.5 billion last year.
“We have now entered a new and challenging phase of low oil prices through the near and medium term,” said Chief Executive Bob Dudley. “Our focus must now be on resetting BP: managing and rebalancing our capital program and cost base for the new reality of lower prices while always maintaining safe, reliable and efficient operations.”
BP said it plans to cut costs by $4 billion to $6 billion this year, reducing exploration expenditures and postponing some projects.
The company is already in the process of downsizing and simplifying its operations, with $5 billion of divestments projected for this year.
BP took a charge of $477 million in the fourth quarter for the 2010 Gulf of Mexico oil spill, bringing total charges for the disaster to $43.5 billion.
Replacement cost profit from Russian oil company Rosneft, in which BP owns a stake, fell 57 percent to $451 million compared with $1.1 billion in the fourth quarter of 2013.

Goodrich Petroleum cuts oil drilling
in La. and Miss.
JACKSON, Miss. — Low oil prices mean the driller that has been the most bullish on an oil region that straddles the Louisiana-Mississippi line is cutting back.
Goodrich Petroleum Corp., based in Houston, said Friday that it will spend $80 million to $100 million on exploration and drilling this year, down from $150 million to $200 million it had previously projected.
The company had projected that it would drill 16 to 21 wells in the Tuscaloosa Marine Shale region in southwest Mississippi and Louisiana’s Florida Parishes. A spokesman didn’t immediately respond to a request for comment, but the new budget will mean fewer wells drilled in 2015.
Part of the money will go to maintaining leases, which could position Goodrich to ramp up activity if oil prices rebound.
Only three rigs are now working in the region, said Liberty accountant Bernell McGehee, who closely tracks drilling activity. That’s down from nine this summer, and could soon fall to two rigs, McGehee said.
Some other companies that had been drilling in the region have cut back or pulled out, in part because of drilling costs exceeding $10 million per well. The oil is deep underground, and long lateral wells must be drilled. It’s also in part because companies have been drilling only one well at a site, instead of multiple wells, and have faced high contracting costs.
Goodrich has been watched closely because the relatively small company, heavily in debt, has devoted most of its efforts to the Tuscaloosa Marine Shale. Company leaders had contracted to sell some output this year at high prices before oil prices plunged below $50 a barrel. But even those hedges were apparently not enough to offset low prices. Some analysts have said that in general, the Tuscaloosa Marine Shale needs prices of about $80 a barrel to be attractive to drillers.

LMOGA awards BP, legislators
NEW ORLEANS — Louisiana Mid-Continent Oil and Gas Association concluded its two-day 2015 annual meeting that included presentations from Louisiana gubernatorial candidates Gregory Hill, president and COO of Hess Corporation; and Chris Chandler, general manager of Natural Gas Liquids for Phillips 66.
LMOGA also announced the re-election of James M. Hutchison Sr. of Freeport-McMoRan Oil & Gas as chairman of the board and Karl Connor, BP America Inc., as vice chairman. Newly elected board members for 2015 include Tracy Case, refining general manager, Marathon Petroleum Company LP in Garyville, and Lem Smith, government and regulatory affairs at EnCana Oil & Gas (USA) Inc.
During the luncheon presentation, LMOGA President Chris John presented BP America Vice President Luke Keller, with the association’s highest honor, the Pelican Award, which recognizes a company that has demonstrated outstanding achievement in the industry and made significant contributions to the community and to the state of Louisiana.
The award was specifically presented to BP for its dedication to STEM education and workforce development. BP has invested $4 million in a state-of-the-art offshore training facility at Fletcher Technical Community College in Houma to ensure Louisiana’s competitive edge in the energy sector for years to come. BP’s recently released US Economic Impact Report 2014 showed that BP spent more than $1 billion with over 375 Louisiana vendors.
“BP is proud to be a significant part of Louisiana’s economy, supporting more than 8,500 jobs in the state. And our investment at Fletcher Technical Community College will develop the next generation of offshore workers, preparing them for high-tech and well-paying careers,” said Keller. “Thank you to LMOGA for recognizing BP’s work in the industry and our broader support of communities in Louisiana.”
In addition, LMOGA presented its Blue Heron Award to state Sen. Robert Adley and state Rep. Gordon Dove for their environmental stewardship in association with oil and gas activity.
From staff and Associated Press reports.
Both term-limited state officials were recognized for their unique efforts to address the compatibility of the oil and gas industry with environmental progress, especially in terms of their leadership in handling legislation dealing with site remediation and coastal restoration.