Cost synergies are well advanced

1
Cost synergies are well advanced
bn
Combined targets July 99
What we did by end 99
What we aim to do in 2000
5.8
2.7
2.0
Cost target
Estimate
Actual
Portfolio rationalisation Organisational
efficiency Focused exploration Business
process Operational rationalisation
2
Global demand for gas is growing
mtoe
800
North America
600
Europe
400
200
Asia Pacific
0
1975
1980
1985
1990
1995
3
We have continued to discover giant fields
4
Future delivery

• Sustainable, double-digit earnings growth
• At mid cycle assumptions
• By demonstrating our capability
• developing the portfolio
• improving productivity
• managing a global company
• Within a disciplined, dynamic financial framework

5
We have grown

Increase since 1996
25
Supermajors
20
15
10
5
0
-5
Oil
Petrochemicals
Gas
6
Continuity and change
What hasnt changed
What has changed

• Determination to deliver
• Leadership
• Organisation model
• Commitment to performance

• Stronger finances
• Wider opportunity set
• Wider skill base
• People diversity
• Unit cost

• Commitment to cost control

• Focus on total productivity

Delivery of continuing productivity improvements
7
Investing for growth - Upstream
of Group capex 2001- 03
20
15
10
5
0
Deepwater oil
Core oil
Core gas
Emerging gas
8
Growth secured by identified projects
2000 - 2003
2004 - 2007
Deepwater oil
Marlin Crosby King Kings Peak Nakika
Gulf of Mexico
Mad Dog Holstein Atlantis Crazy Horse
Angola
Girassol
Dalia Plutonio Kizomba
9
Growth secured by identified projects
2000 - 2003
2004 - 2007
Core oil
Shearwater (UK) Northstar (Alaska)
Chirag-Azeri
Shearwater (UK)
Egypt Alaska
Core gas
Emerging gas
Trinidad Algeria Indonesia
Trinidad Indonesia
10
Growth from many sources
mboed
6000
5000
Emerging Gas
4000
Core Gas
3000
2000
Deepwater Oil
1000
Core Oil
1998
2000
2003
2007
1999
2001
2002
11
Production volumes
Mbbl/d actual/targeted
3500
Oil
99 Target
3000
2500
2000
1500
1000
500
1995
2000
2003
2007
12
Production volumes
Bcf/d actual/targeted
21
Gas
99 Target
18
15
12
9
6
3
1995
2000
2003
2007
13
Learning reduces capital costs
/ tpa LNG Plant costs
700
600
500
400
300
200
100
0
65-70
70-75
75-80
80-85
85-90
90-95
95-99
00
Trinidad Train 1
Trinidad Trains 2 and 3
14
Investing for growth - Downstream
of Group capex 2001- 03
15
10
5
0
OECD retail
Refining
Lubricants/ new markets
15
Investing for growth - Petrochemicals
of Group capex 2001- 03
10
5
0
Olefins
Aromatics
Related
16
The oil price remains unpredictable
/ bbl
30
28
26
24
22
Gulf War
20
18
Mid - cycle
16
14
Bottom - cycle
12
10
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
17
The US gas price is trending higher
per mscf
5
4
3
Mid - cycle
2
Bottom - cycle
1
0
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
18
Refining margins remain volatile
/ bbl
10
8
6
4
Mid - cycle
2
Bottom - cycle
0
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
19
Supply-led chemicals cycle drives margins
/ te
400
350
300
250
200
Mid - cycle
150
100
Bottom - cycle
50
0
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
20
New top-line growth aspiration
Growth pa 2000 to 2003
Retail Petroleum sales
3 - 4
21
driven by selective investment
bn Average pa
Gross Capex 2001 - 2003
Growth in capital employed 4 - 6 pa