BP has reported that its 2013 first quarter earnings have jumped to $4.2bn, compared to $3.9bn in the previous quarter, but fallen from $4.7bn in the same quarter last year.
The UK-based energy firm said that its operating cash flow in the quarter was $4.0bn, compared with $3.4bn in the first quarter of 2012.
BP Group chief executive Bob Dudley said: "These strong first quarter results demonstrate the progress BP is making in delivering the performance milestones that support our ten-point plan and underpin our commitment to material operating cash flow growth by 2014."
"The early completion of the sale of our interest in TNK-BP has also allowed us to begin a share buy-back programme which we expect to return up to $8bn to our shareholders and reflects the reduction in BP’s asset base following our divestment programme over the past three years," Dudley added.
"These results represent a strong start to 2013 across all of our businesses."
The company had bought back 120 million shares for a total of $834m, including fees and stamp duty, as of 26 April 2013.
BP is considering whether to retain the balance of the cash received from the TNK-BP transaction, in order to reduce net debt as part of its commitment to maintain a strong balance sheet.
On 21 March 2013, BP completed the sale of its interest in TNK-BP to Rosneft, for a total consideration of $27.5bn in cash and Rosneft shares. BP currently holds a total 19.75% interest in Rosneft. The 11 days of earnings from Rosneft in the first quarter of 2013 has been estimated to be $85m.
The company said reported production in the second quarter is anticipated to be less significant, due to planned seasonal turnaround activity mainly focussed on higher-margin assets in the Gulf of Mexico and the North Sea.
BP has plans to drill between 15 and 25 exploration wells by the end of 2013, out of which eight are currently in progress. These include wells in Egypt, India, Jordan, the Gulf of Mexico and Indonesia.
On 17 April, the first phase of the MDL2179 civil trial related to the April 2010 Deepwater Horizon accident ended in the US.
The second phase of the trial, which will address source control issues and the quantity of oil released, is expected to commence in September 2013. BP said the total cumulative charge, net of recoveries, for the Gulf of Mexico oil spill at the end of the quarter was $42.2bn.
The company said the total amount it has to pay in connection to all the obligations relating to the Deepwater Horizon accident will be dependent on many factors.
Image: BP Group chief executive Bob Dudley. Photo courtesy of Premier.gov.ru.