February 28, 2017 / 1:55 PM / 9 months ago

BRIEF-BP updates 5-year strategy, sets cash flow targets for units

Feb 28 (Reuters) - BP Plc:

* Sees cash flow growing materially: - upstream $13-14 billion pre-tax free cash flow in 2021, downstream $9-10 billion pre-tax free cash flow in 2021

* Sees financial frame maintained to 2021, organic capital spending $15-17 billion a year, gearing 20-30 pct

* Upstream production expected to grow by average of 5 pct a year from 2016 to 2021

* 9 projects now under construction expected onstream 2018-21

* Cash balance point for bp expected to fall to around $35-40/barrel in 2021

* Production ramping up from new upstream projects is expected to deliver a material improvement in operating cash flow through H2 of 2017

* Will continue that tight focus on costs and capital discipline and seek further improvements throughout group - CFO

* Volume and margin growth throughout BP’s businesses are expected to increase returns over next five years

* Upstream projects coming on line in 2016 and 2017 are on track to deliver 500,000 boe/d new production capacity by end of this year

* New upstream projects remain on track to deliver 800,000 boe/d of new production by 2020, as previously guided

* On average, new upstream projects are also expected to have operating cash margins 35% higher than average of BP’s upstream portfolio in 2015

* Downstream - underlying earnings from manufacturing businesses in 2021 are expected to be $2.5 billion higher than in 2014.

* Expects significant earnings growth from its downstream marketing businesses, with underlying earnings in 2021 more than $3 billion higher than in 2014

* Downstream unit to deliver $9-10 billion of pre-tax free cash flow by 2021, with returns of around 20 pct in 2021. Source text for Eikon: Further company coverage: (Bengaluru Newsroom)

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