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. Last Updated: 07/27/2016

BP Plans 50% Output Hike by 2001

LONDON -- BP Amoco will concentrate new upstream spending on natural gas and aims to boost output by 50 percent by the end of next year, chief executive John Browne said Tuesday.

Gas production would jump to 240 million cubic meters a day by end 2000 and 270 million by end 2001 from 180 million cubic meters a day in 1999 after strong oil and gas prices and merger cost cutting produced a second successive record quarterly result for the oil giant.

That will give gas, at the equivalent of 3.6 million barrels a day of liquids, a two-thirds share of BP Amoco's production portfolio. Oil output will be kept steady at about 2 million bpd.

Overall, the company will keep a tight lid on capital spending, according to figures released by Browne. Like others in the sector, BP Amoco is not to be tempted into high spending by strong oil prices.

"Organic" spending this year, including investment for the newly acquired Atlantic Richfield Co., or Arco, will run at $10 billion to $11 billion, Browne said.

Last year, BP Amoco and Arco together spent $10.6 billion, and previous combined projections add up to 2000 expenditure of just over $11 billion, BP Amoco officials said.

Browne said the company would now begin a share-buyback plan approved by shareholders in April "at the appropriate time."

Browne said a further $3 billion worth of costs savings - on top of the $2.1 billion already delivered since its takeover of Amoco - was still to come after the Arco purchase, and when the acquisition of Burmah Castrol is completed later this year.

First-quarter adjusted profit was a record $2.707 billion, close to the top of analysts' forecasts and up 256 percent on a year ago.