BP PLC (LSE:BP.) appears confident in hitting pre-tax earnings of between US$46 billion and US$49 billion by 2025, UBS analysts said following recent meetings with the oil giant.
“This confidence comes from the high grading of its upstream portfolio through the ramp-up of higher-margin projects, increased presence in the liquified natural gas and power trading markets and integration of acquisitions already made,” a Thursday note said.
Production capacity for some 100,000 barrels of oil equivalent per day (boe/d) is already online, UBS reported after the meetings.
This represents half of the planned additional capacity for 2025, with BP having produced an average of 406,000 boe/d in the fourth quarter of last year.
BP’s bioenergy business will likely add US$2 billion to pre-tax earnings come next year, meanwhile, a factor UBS said the markets were largely ignoring currently.
Alongside this, the oil giant’s electric vehicle charging wing will offer a US$1.5 billion boost as it swings back from initial losses.
Other benefits will likely be had from a planned turnaround in its refining business this year, UBS said, with upside also expected from subsidiaries such as Castrol.
Shares climbed 0.8% to 488.95p.