BP to Spend $9 Billion on Australia Fuel Stations, ExplorationBen Sharples
BP Plc, the operator of the biggest oil refinery in Australia, plans to spend A$10 billion ($9.3 billion) this decade expanding its filling station network and developing oil and gas projects such as the Browse venture.
The company will open a dozen new filling stations during the next 12 months while seeking to increase the fleet through acquisitions, Andy Holmes, the president of BP’s Australasia business, said in an interview. He declined to elaborate on potential takeover targets. The London-based group will spend about A$2.3 billion over the next five years on its downstream unit that also includes the Kwinana refinery in Perth.
BP is seeking to expand its retail business even as it scales back refining in Australia while companies including Trafigura Beheer BV, the world’s third-largest independent oil trader, and Vitol Group gain a foothold in the industry. The company will also spend more than A$1 billion on a deep-water drilling campaign off the southern coast, Holmes said.
“The big opportunities we’re after is at the customer end of the business,” Holmes said at an Australian British Chamber of Commerce event in Melbourne today. “Filling stations, or truck stops, or motorway stations, that’s the area where we’re turning up our focus.”
The company owns about 330 of the 1,300 BP-branded filling stations in Australia. It will halt operations at its Bulwer Island refinery in Queensland by mid-2015 and may convert the facility into a fuel-import terminal amid competition from Asia.
Viva Energy, a unit of Vitol, will spend A$1 billion over the next five years after buying Royal Dutch Shell Plc’s Geelong plant in Victoria and its 870-site retail business. Trafigura’s Puma Energy last year purchased two companies that will give it more than 200 pump stations in Australia.
BP also has an interest in fields that will feed the Chevron Corp.-operated Gorgon liquefied natural gas project, along with a stake in the North West Shelf Venture and the Browse LNG project. The company will start its deep-water drill campaign in the Great Australian Bight in 2016, Holmes said.
“We have ambitions to further grow our upstream presence,” Holmes said in a speech at the event. “We believe the Great Australian Bight can prove to be a new hydrocarbon basin. BP is also heavily invested in the development of the Browse gas resource.”
Woodside Petroleum Ltd., the operator of the Browse LNG project, scrapped a plan last year to build it onshore in Western Australia, estimating later it would have cost more than A$80 billion. Instead, the company plans to decide in mid-2015 whether to proceed with a plan to liquefy the gas on giant ships offshore, using Royal Dutch Shell Plc technology.