BP has hiked its dividend after surging back into the black last year and highlighted the expected profitability of some of its big investments in the North Sea.
The oil and gas giant said it will increase its fourth -quarter payout by 14% as its chief executive Bob Dudley claimed it is "on the right path" after the disastrous spill in the Gulf of Mexico in 2010.
BP made $23.9 billion (£15bn) profit excluding inventory gains in 2011 helped by strong oil prices, after losing $4.9bn in the preceding year.
Mr Dudley said BP expects to increase the cash it generates by 50% by 2014 in a $100 per barrel price environment, paving the way for bigger payouts to investors.
BP expects to double the profitability of the key upstream business by 2014 following hefty investment in flagship projects in core areas including the North Sea.
"Six major upstream projects in higher unit operating cash margin areas – Angola, the Gulf of Mexico and the North Sea – are expected to come on stream in 2012," the company said.
BP plans to bring a further nine major projects into production in 2013 and 2012. It added: "All of these are expected to deliver an average unit cash margin by 2014 that is around twice that of BP's 2011 upstream portfolio."
The projects include the Devenick gas field and the Kinnoull oil development in the North Sea.
Last year BP announced plans for the £3bn redevelopment of the Schiehallion field and the £4.5bn Clair Ridge project in the UK North Sea, despite the surprise hike in taxes in the March Budget. These should come onstream in 2016.
BP is selling some less profit-able assets including its operated gas fields in the southern North Sea, to raise money to help cover the costs of the Gulf of Mexico spill. This followed an explosion on the Deepwater Horizon rig in which 11 people died.
BP has increased its estimate of the total cost of the spill by $1.8bn to $43bn.
The size of the final bill will depend on the outcome of legal actions involving US Federal and state authorities and individuals.
Key legal hearings are due to start in New Orleans on February 27.
Mr Dudley said: "We are prepared to settle if we can do so on fair and reasonable terms, but equally, if this is not possible, we are preparing vigorously for trial."
Charles Stanley's Tony Shepard said: "BP's share valuation is low relative to oil and gas majors but it still faces uncertainty over the Gulf of Mexico tragedy. Our recommendation is 'hold'."
BP will pay an eight cents per share fourth-quarter dividend compared with seven cents per share for the third quarter. It paid 14 cents per share quarterly before the Gulf spill.
BP made a fourth-quarter underlying profit before one offs of $5bn, against $4.4bn in the same period of 2010.
Shares in BP on the London Stock Exchange, yesterday closed down 3.05p, or 0.62%, at 486.5p.
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