Alongside leading the way in the core oil and gas arena through, for example, developing cleaner, more efficient low-sulphur fuels, the company has also invested heavily in developing its renewable energy portfolio and is now one of the prime generators of solar energy. Indeed, of all the energy majors, BP is the one making the most noise about alternative sources of energy, cleaner fuels and carbon footprints: Having now scaled up its innovative internal emissions trading system, the company has also invested in CO2 capture and storage through subsurface sequestration in Algeria and is pushing its first decarbonised gas to hydrogen plant in Scotland. Other core business technological innovations have included using advanced seismic imaging in the deep waters of the Gulf of Mexico, multilateral drilling in Alaska and enhanced oil recovery worldwide. In 2005 with total revenues of over $260bn, BP generated post-tax profits of $19.3bn, up 25% year on year. Despite the impact of the hurricanes in the Gulf of Mexico, production in its upstream division rose and the crucial reserve replacement ratio was maintained above 100% for a thirteenth consecutive year. With the introduction of new products and higher oil prices globally there were higher margins in both refining and marketing, with associated profits nearing $7bn for the first time.

BP is spending over a third of its increasing technology budget on potentially game-changing innovations across both existing and new energy spaces. Faced with the multiple challenges of declining supplies and security of supply issues in oil and gas, global warming and the demand for cleaner energy in key markets, BP’s proportion of spend on new technologies is increasing each year - investing $120m in renewables alone. Led by a GVP for Technology, the company has a decentralised approach to R&D investment in its business units while simultaneously driving the strategic positioning of technology across the company over next 15 to 30 years. Acting operationally as an integrator of the most appropriate technologies from inside and outside the organisation and strategically as a champion of selected new technologies, BP is maintaining its innovation leadership in the sector. With an ambition of being “twice as good as next best competitor” BP’s innovation agenda is high profile, well funded and increasingly integrated into the company’s key internal performance metrics.

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