Good morning, everyone, and welcome to BP's third quarter 2023 results presentation. I'm here today with Murray Auchincloss, Chief Executive Officer; and Kate Thomson, Chief Financial Officer. Before we begin today, let me draw your attention to our cautionary statement. During today's presentation, we will make forward-looking statements that refer to our estimates, plans and expectations. Actual results and outcomes could differ materially due to the factors we note on this slide and in our U.K. and SEC filings. Please refer to our annual report, stock exchange announcement and SEC filings for more details. These documents are available on our website. Let me now hand over to Murray.

Thanks, Craig. Good morning, everyone. Thanks for joining us. We hosted our investor update in Denver a few weeks ago, focused on our oil, gas and biogas businesses, including a site visit to BPX' Permian operation. We had 3 core messages that I want to reemphasize today. First, our strategy, transforming to an integrated energy company, is unchanged. Second, we are focused on delivering our strategy safely quarter-on-quarter to meet our 2025 targets and 2030 aims. And third, we are focused on growing long-term shareholder value. We continue to expect to grow EBITDA to 2025 and aim to keep growing to 2030, all while delivering compelling shareholder distributions. Earlier this month, we said we expect 2030 adjusted EBITDA aims from resilient hydrocarbons and group will be around $2 billion higher than BP's previous targets, to a range of $41 billion to $44 billion and $53 billion to $58 billion, respectively. Underpinning this increase, we presented what we believe is a high-quality, distinctive oil and gas portfolio; and a leading delivery model enabling efficient execution. We expect to grow EBITDA from oil and gas to 2025, sustained it at that level through 2030, with the capacity to sustain well into the next decade. And we believe there's more to come. This slide summarizes the key message from the event. And if you haven't seen the materials, we encourage you to take a look on bp.com. Turning then to our third quarter 2023 results. For the third quarter, we delivered strong operational performance with upstream plant reliability and refining availability at around 96% year-to-date. This came on top of 3% volume growth year-to-date and a 6% decline in unit production costs. Underlying earnings were $3.3 billion. And we delivered robust operating cash flow of $8.7 billion, including a working capital release of $2 billion. We are executing against our disciplined financial frame. Today, we have announced a further $1.5 billion share buyback. This reflects the confidence in our performance and the outlook for cash flow. Turning to strategic delivery, where we see continued momentum. In oil and gas, we started up the Tangguh expansion project in Indonesia, our third major project this year. In August, we started up Bingo, BPX' second major processing facility in the Permian, doubling our oil and gas processing capacity in the basin. And we received regulatory approval for Murlach, a 2-well oil and gas redevelopment of the Marnock-Skua field in the North Sea. In LNG, we signed a long-term agreement with OMV to supply up to 1 million tonnes per annum of LNG for 10 years from 2026. And we secured our third long-term LNG offtake contract from Woodfibre, where we are the sole offtaker of almost 2 million tonnes per annum from 2027. Turning to our transition growth engines. In bioenergy, we are scaling up our biogas business Archaea Energy, with the first Archaea modular design renewable natural gas plant now online in Medora, Indiana. This underpins our confidence in our expansion plans going forward. In EV charging, we continued to accelerate our EV charging ambition across key markets. We have announced an agreement with Tesla for the future purchase of $100 million of ultrafast chargers in the U.S. This is part of our approved $500 million EV charging infrastructure investment in the U.S. previously announced. In the U.K., bp pulse, together with partners, launched the country's largest public EV charging hub at the NEC campus in Birmingham, enabling 180 EVs to charge simultaneously. In convenience, TravelCenters of America continues to integrate well. And in the first 9 months of 2023, excluding TA, we delivered around 8% year-on-year growth in convenience gross margin. And we extended our successful strategic convenience agreement with Auchan in Poland, with plans to add more than 100 stores to our network by the end of 2025. In hydrogen, the Midwest Alliance for Clean Hydrogen, of which BP is a member, announced it has been selected by the U.S. Department of Energy to develop a regional clean hydrogen hub in the U.S. Midwest. And finally, in renewables and power, we have increased our pipeline to 43.9 gigawatts with the addition of 4 gigawatts from 2 offshore projects in Germany recently awarded. Now let me hand over to Kate to take you through our third quarter results in more detail.

Thanks, Murray. And good morning, everyone. It was great to meet a number of you in Denver recently. For the third quarter, we reported an underlying replacement cost profit of $3.3 billion compared to $2.6 billion last quarter. Compared to the second quarter, in gas & low carbon energy, the result reflects a weak gas marketing and trading result following the exceptional performance in the first half of 2023. In oil production & operations, the result reflects higher oil and gas realizations despite the impact of price lags on Gulf of Mexico and UAE realizations and higher production. And in customers & products, the products result reflects a higher realized refining margin, a lower level of turnaround activity and a very strong oil trading result. In our customers business, we continue to show strong momentum in convenience and aviation, benefiting from seasonally higher fuel volumes partially offset by lower margins given the rising cost of supply. Turning to cash flow and the balance sheet. Operating cash flow was $8.7 billion in the third quarter. This includes a working capital release of $2 billion after adjusting for inventory holding gains and fair value accounting effects and other adjusting items. Capital expenditure was $3.6 billion, including inorganic expenditure, net of adjustments. During the quarter, we repurchased $2 billion of shares. The $1.5 billion program announced with second quarter 2023 results was completed on the 27th of October. Surplus cash flow was $3.1 billion, and net debt reduced by $1.3 billion to $22.3 billion. Our disciplined financial frame remains unchanged with a focus on 5 key priorities. A resilient dividend remains our first priority. We have today announced a dividend of $0.0727 per ordinary share for the third quarter. We remain committed to maintaining a strong investment-grade credit rating and continue to target progress within the A range. We aren't targeting a AA rating. We are investing with discipline in our transition growth engines; and in our oil, gas and refining businesses. Our capital expenditure guidance for 2023, including inorganics, is now expected to be around $16 billion. And we're committed to allocating 60% of 2023 surplus cash flow to buybacks, subject to maintaining a strong investment-grade credit rating. Finally, we intend to execute a buyback of $1.5 billion prior to reporting fourth quarter results. This reflects the confidence we have in our performance and the outlook for cash flow. I'll now hand back to Murray for his closing remarks.

Thanks, Kate. Let me wrap up. We are growing the value of BP, investing in today's oil and gas system and investing in our transition growth engines. We are firmly focused on delivering our strategy safely with discipline and, in doing so, quarter-on-quarter, to meet our 2025 targets and 2030 aims, all in service of growing long-term shareholder value. With that, Kate and I will be happy to take your questions.

[Operator Instructions]

Okay, great. Thank you again, everybody, for listening. We'll turn to questions now. [Operator Instructions] We'll turn to the first question from Henri Patricot at UBS.

A couple of questions, please. To the first one, on results. You mentioned a weak gas trading contribution. Could you expand on what was driving the weakness, whether there's any implications in terms of the performance that we should expect in the fourth quarter? And then secondly, I would like to come back on the U.S. offshore wind project. Obviously you put through an impairment in the quarter. Could you comment on perhaps the [ next steps that you expect ]? And any further risk, financial risk, for yourselves with regards to this project should it not go ahead ultimately?

Great. Thanks, Henri. I'll take the first question and I'll let Kate take the second one. Just a -- maybe a reminder on the quarter: We had a pretty strong operating performance across the business. The highlights, you'll see, 96% plant reliability across the upstream and downstream, production growth 3% year-on-year. I think that's leading the sector. Unit costs down 6% in the upstream, again a very strong performance; and cash delivery, well, I think, in line with expectation. So obviously the difficult bit was the weakness in gas trading, as you mentioned. If you think back to the year, in the first quarter, we had an exceptional performance. In the second quarter, we had exceptional performance. And then in the third quarter, we're calling it weak. That was really due to lack of structure in the market. So there was a little bit of volatility in the prompt, but the actual structure of the market, as you looked out across multiple months, wasn't moving around. The reason for that obviously is the gas inventories in Europe and the United States were relatively full, so that said, it didn't make sense to put a lot of risk on to the gas side. Instead, we reallocated risk to the oil side. And you saw that oil had a very strong result. As far as the outlook to the next quarter, without guiding, all I'd say is you need to look at structure. As we head into 4Q, I think gas storage is at 98% full inside Europe. It's at average levels, I think, inside the United States, so volatility will tell. If there are outages, if [ there are ] weather, that will tell whether or not there's much structure inside the gas market. And then on the refined product side, I think gasoline and diesel inventories are quite high right now, so it's lacking a bit of structure right now as well. All of this can change in November and December based on outages or volatility, so that's the gas side. Kate, over to you on wind.

Yes. Thanks, Murray. So you'll be aware that, back in June, we requested a renegotiation of our power purchase agreements with New York. That was rejected in October, and as a consequence of that, our accountants have had a look at our fair value of our assets. And as you're aware, in this quarter, we have taken a $540 million pretax impairment on that. Looking forward, well, we'll need to see how circumstances evolve and continue to run our typical processes. We'll work with our partners closely on the way forward. As you'd imagine us to say that those decisions will be based on value, we need to see those projects continue to meet a 6% to 8% unlevered return, which is what we've been clear on with regard to offshore wind and our requirements, so let's see how it evolves.

Thanks, Kate. Thanks, Murray. We'll take the next question from Irene Himona, please.

My first question, on working capital, please. How much of the $2 billion release that you had in Q3 corresponds to the $5 billion working capital unwinding which you had mentioned before relating to LNG? And then secondly, going back, Murray, to your comments on BPX, I'm just curious. In light of the 2 huge deals by Exxon, Chevron in the past 2 weeks, do you feel that perhaps that business maybe lacks a little bit the scale to compete efficiently in this apparently newly developing landscape? Would a potential step-up via a JV help to grow that scale?

Great. Thanks, Irene. I'll take the second question and I'll ask Kate to start with the working capital answer, please. Kate?

Sure. Thanks, Irene. So in the third quarter, you can see we have a release of $2 billion on working capital. Much of that was associated with delivery of LNG cargoes. As you note, Murray has previously said we had around $5 billion of working capital to unwind over that as a consequence. We're expecting around $3 billion to continue to unwind over the next 3 quarters, but as you know, look, working capital fluctuates quarter-on-quarter. It's important to look through the year. And if you look year-to-date, we're pretty flat. We've got a $679 million release year-to-date, so I'd just encourage you to keep looking through the quarter on the year on working capital and about $3 billion left on the LNG cargoes.

Thanks, Kate. And then Irene, on BPX and the U.S., as we laid out in Denver, we've got a great upstream portfolio of 36 billion barrels of total resource; 18 billion in the plan right now, economic at our thresholds, to be developed over the next couple decades. We have the capacity to grow earnings through 2025 and then maintain at that level through 2030 and beyond, so we feel we've got a very high-quality upstream portfolio. Inside the United States in particular, we have a great portfolio as well. Between the GOM and BPX, it was producing about 600 kbd in 2022; and we aim to produce about 1 million a day by the end of the decade. That's 7% compound annual growth and it will make up 50% of BP's production by the end of the decade, so we feel we have great resource positions already, 8 billion of barrels of resource in the Paleogene to develop, 7 billion barrels of resource in BPX to develop. And we don't really feel we need more acreage. We will consider countercyclical moves, so as we look around the world, in other places, if we see countercyclical opportunities, we might pursue those. Some of you will remember that we did that in Australia a while back on a countercyclical opportunity, but we're very happy with our position in the U.S. and we just need to organically develop that now. Thank you for your question, Irene.

Okay, thanks, Irene. We'll take the next question from Os Clint at Bernstein.

Just on the CapEx reduction down to the low end of the expected range. Where does that $1 billion or $2 billion reduction come from? I guess some phasing perhaps, but perhaps if you could just break it out. And linked to that, there's only $1 billion of divestments insofar this year. I think you're still expecting $2 billion to $3 billion, so what are we still expecting to see come in towards the end of the year, please? And then secondly, just on gas again, you have picked up some more acreage actually offshore Israel despite what's happening. Maybe just talk about that, those plans and also perhaps closing this NewMed deal, in terms of building up a hub, a gas hub, in the eastern side of Mediterranean.

Great. Thanks, Os. Let me start with Israel. And first, let me say we're deeply saddened by the tragic events in the Middle East and the devastating human impact it's having. And we're just hoping for a sustained and peaceful resolution. On NewMed, we'll update the market as appropriate, but for now there is no new update. You're correct: On July 16, we applied for acreage in Israel. SOCAR is the operator. NewMed is a partner, and BP. And that was obviously awarded over the weekend. We've been in the Eastern Mediterranean for a long time. We'll see how we go. It is exploration acreage, so we'll just have to see how that goes, Os. If I turn to the divestment question for Kate, please.

Yes. So I -- Os, I think we're at about $1.5 billion year-to-date in terms of divestments. We're continuing to guide to $2 billion to $3 billion for the full year. As you know, these ongoing processes aren't entirely within our control, but that's our guidance as we stand here today.

Great. Thanks, Kate. And on CapEx, Os, I think you'll see a year-to-date number of $11.5 billion spent this year, organics running somewhere around [ 3.5 to 4 ] each quarter. And the reason that we're not going to hit the higher end of the range, the $16 billion to $18 billion we guided originally, was that was for space for inorganics. You'll remember, as we set out our long-term frame, we said $14 billion to $18 billion, including organics and inorganics. Gradually, organic capital ramps up as you think about TA. If you think about Archaea, the organic side ramps up, but in '23, '24, '25, we do have capacity to do inorganics, so those inorganics that we were thinking about, we're just going to pass on those for now. So we're estimating $16 billion for the year. Thanks for the questions, Os.

Thanks, Os. We will take the next question from Biraj Borkhataria from RBC.

I wanted to ask on the debt number. So you're sitting on, your definition, $22 billion of net debt. I guess, if you're a rating agency, you look at it with the various other items added back, but if we take your number, is there an absolute level of net debt you want to get to before you next review your payout ratio, to that $22 billion? And then the second question is on Tortue. I know there's been various issues at that project. I noticed in the Denver slides Phase 2 is now in the "beyond the '30" bucket, so could you talk about that project, key next deliverables and how you're thinking about the development overall from here?

Great. I'll take Tortue. And Kate, if you can take the financial frame question, as you're now keeper of the financial frame. Hard one for me to let go, but Kate will do a fantastic job on it. As far as Tortue goes, on Phase 1 itself, we're at about 90% complete now. The offshore breakwater and facilities are complete and handed over to operations; the FLNG vote -- boat, we anticipate leaving Singapore by the end of the year. The FPSO has left China and Singapore and it's on its way to West Africa. And obviously we've replaced the contractor on the subsea systems, so we're hopeful that, that starts up in 1Q. As far as Phase 2 goes, we really need to focus right now on getting Phase 1 and up -- Phase 1 up. That is the principal focus we have. As we do that, we'll see how the productivity is of the resource base. And that will inform Phase 2, where we have to continue through the design we're in to optimizing that space and commercial negotiations with the host governments and partners. So a ways to go yet on Phase 2, Biraj. Thanks for your question.

And shall I take the financial frame question? So thanks, Biraj. Good question, yes, so let me step back from this a little bit. Yes, we've reduced net debt again this quarter, down to $22 billion. If I think back to when I was Treasurer in 2020, we've come down from a high of $51 billion, so tremendous progress on that. It's important to remember the order of prioritization, I think, in the financial frame. We've been incredibly clear on that. And the strengthening of the balance sheet and in particular targeting progress within the A range remains the second priority. Look. I think the financial frame is doing its job right now. It works really well in high prices and low prices. We like the order of prioritization. And for 2023, we're going to continue to allocate 40% of surplus to the balance sheet. And I think that's good for us for now. Thank you.

Great. Thanks, Biraj. We'll take the next question from Michele Della Vigna at Goldman's.

Two quick questions. On the price lags that you mentioned in the quarter, I was wondering if you could quantify the impact it had, especially in your E&P division. And then secondly, going back for a moment to the U.S. offshore wind, I was wondering if you could disclose your committed spend for the coming years in terms of pre-agreed supplies or pre-booking of transport capacity.

Yes, great. I'll take the second one, and Kate can take the price lag question. I think on the offshore wind commitments there are cancellation options inside these things, but as you can imagine, it's quite commercially sensitive, so we don't disclose those things. My apologies, Michele. And then Kate, over to you on price lag.

Yes. So as you're aware, we have price lag impacts coming through volumes both from Gulf of Mexico and UAE. I think, from memory, we were around about 800 million impact on the quarter, but if that's wrong, we can correct that after. I'm sure [indiscernible] can help me.

Okay, great. We'll take the next question from Henry Tarr, please, at Berenberg. Thank you, Henry.

Just to come back on the offshore wind in -- offshore the U.S. There's the impairment this quarter. What's left on the books for those U.S. projects? And then I guess I know obviously there's going to be discussions around what happens from here, but I guess there's a new RFP out. Do you think it's likely that you'll be sort of bidding into that? And then perhaps if you could just comment on the sort of overall cost situation for renewables as you see it at the moment.

Great. I'll take those questions. We're not disclosing what's left on the books. We think that's commercially sensitive, so we won't be doing that. As far as path forward on this, I think, as Kate mentioned, there was a 10-point plan put out by New York state. We're working to understand that plan. It's just come out, so we're working with our partners, Equinor, to understand what that 10-point plan means. And we'll think about, with Equinor, how we do that. It includes the right to -- I think it includes the right to invalidate your previous PPA and solicit for a new PPA, so work to do and we'll update the market in due course on how that's going. As far as how are other places working, I think Europe, Asia is working fine on PPAs for solar as we see them through Lightsource bp. The U.S. is a bit sticky right now with rising interest rates. And power prices aren't quite converging with those, but by and large, across Europe and Asia, we see those as working out.

We'll take the next question from Lydia Rainforth at Barclays.

Two questions, if I could. The first one, on upstream volumes. The guide is flat for the fourth quarter versus the third quarter, but given the startup of Bingo, given the startup of -- in Indonesia, I mean, I'm surprised it's not a little bit higher, so is there -- what am I missing on that bit? And then secondly, Murray, just this is a bigger picture question, but are you happy with where the results are for this quarter? Obviously you've had decent results in terms of operating performance. Costs are down in the upstream, but you are seeing inflation in the downstream. There's the volatility in the gas trading [ side ], so I'm just wondering. Is this where you think the performance of BP should be in this oil price environment?

Great. I'll let Kate take the upstream volumes. On results, Lydia, as I've stated earlier, the operating results are awfully good. And it mirrors what we talked to you about in Denver, so the fact that the plants keep running at 96% is amazing. The fact that volume growth is up 3% year-on-year is fantastic. Costs down, again I think fantastic results at the same time that Tier 1 safety events are off almost 50% year-on-year. So I think the overall operating capacity of the business is running very, very strong. 2 places that are challenging right now: retail margins, so these are fuel margins, whether it be on diesel or gasoline. We see the market is oversupplied as we entered September, October, yes, but as we all know, that can change quickly. There is not much excess capacity inside refining around the world. And any weather event or any outage will create a change in the margins and a change in volatility, so I think let's watch the space. It does feel like a more volatile world than necessarily we've seen through September and October, but that's obviously something that we don't control. As far as trading, obviously we've had a very, very good year, 1Q gas trading exceptional, 2Q trading exceptional, 3Q lack of structure. There's not an awful lot you can do when there's 0 structure inside gas trading, so we will see. Weather will determine it. Outages will determine it. And you know that our business is poised to take -- to do well when volatility occurs, so overall I think the business is performing quite well. And on the quarter, most of the miss can be ascribed to gas, but of course, we pivoted our risk to the oil side, so I think maybe we got a bit ahead of ourselves and expectations around 3Q. Let's see. So I hope that helps, Lydia. And we'll pass over to Kate on volume.

Yes. Thanks. Lydia, thanks for the question, yes. So I think Murray has been super clear in terms of our kit. It's working really well. We're very pleased with the level of reliability across the portfolio and the delivery that we've got in terms of our overall production performance. On major projects, we've got 3 out of 4 online. The fourth is due to start up imminently. And they're ramping up nicely. In terms of 4Q itself, it's just typical seasonal maintenance that we're seeing coming through. That coupled with some PSA entitlement impacts, that's really what you're seeing that's offsetting the strong performance of -- across the portfolio, to see us broadly flat overall for the fourth quarter.

Thanks, Kate. Okay, we'll take the next question from Christyan Malek at JPMorgan.

So a couple of questions from me. First is just on the buyback maths. I mean, if I run the buyback flat at $1.5 billion into Q4, that's a total of $6.25 billion and, based on the 60% payout, implies you're going to need to deliver full year surplus over $10 billion, so Q4 is going to have to be amazing. And I'm just trying to reconcile that given what you've provided for into Q4, so can you just help me in case I've missed something? Are you assuming trading is going to do a whole lot better, which I think I kind of wonder about given it's quite volatile [ in itself as we've seen ]. That's my first question. The second question, please, is I distinctly remember how you said offshore wind was one of your best positions from a returns perspective. And now it's [ got a $500 million ] pretax offshore wind impairment. My worry is that we're seeing more write-downs elsewhere in the portfolio, so what sort of guarantees can you provide that this [ isn't a ] moving target, essentially lower? And sorry for the final question, but just I had to ask this [indiscernible] to do on this. There's quite a lot of M&A speculation around BP. Of course, I'm not going to ask you to comment, but I actually want to know what your thoughts are on the U.S. mega deals recently and whether there is an industrial logic for mega deals here in the U.K.

Okay, great. I'll ask Kate to tackle the surplus question. As far as offshore wind, Christyan, well, you were with us in Denver. I don't think I said what you quoted. If you remember what I talked about on returns hierarchy, I talked about that biofuels were fantastic. Convenience and electrification was fantastic. Third call on capital was the upstream, and then hydrogen and offshore wind. And in offshore wind, we're really focused on integration, so it's about taking the electrons in the U.K.; taking the electrons in Germany; and providing those into the rest of our businesses, so into refineries, into fast charging with fleets, into hydrogen plants and into trading relationships we have with others. That -- on a stand-alone basis, those would get you 6% to 8% unlevered returns. Of course, if you start to create the integration value with that, the returns go up an awful lot more, so I think the way I'd think about it: As time has progressed, we've focused much more on the integrated opportunities that we see in Europe. And that's why you didn't see us bid in many of the offshore wind rounds in the United States over the recent quarters. So that's how we think about offshore wind. I think, on M&A and will we see M&A activity, of course, I can't really comment on that. For our part, we're very pleased with how the company is performing. Our share price multiples are trading equivalent with our European peers. We have closed the gap to some of the U.S. peers by 1/3 over the past 12 months. And as we continue to grow EBITDA per share, I think, at a 12% ratio as we continue with our distribution framework -- I think it's double digit, which is at the top end of the sector. I think you'll see us continue to close that share price gap, so we're really focused on organically driving the shareholder value for shareholders. So that's that M&A is really not on our minds, if I'm honest. And then over to Kate on surplus.

Thanks, Murray. So yes, you're right. Our rule of thumb works really well. So the $4 billion at 60%, adjust that for price and capital. So we've got about $82 year-to-date average price. And CapEx, we're saying, is going to be around $16 billion for the year, so I think, if you do the maths on that, we're pretty much bang on that $1.5 billion. In terms of so what does that imply for 4Q, I think we feel pretty good about 4Q. Our operational momentum is there. We've talked about that a number of times already this morning. We've still got LNG cargoes that are going to unwind over the next 3 quarters. Oil price [ feels supported ] at the moment. There's potential for volatility in gas refining margins. Let's see on that, but it's always going to be a consideration, at the end of the quarter, in terms of where the Board takes its position. It will use its judgment. It will look forwards. It will look back over surplus year-to-date, share buybacks year-to-date; and form a view based on a range of factors at that point in time, but in terms of 4Q cash flow, yes, we feel pretty confident on that right now.

Great, thank you, Kate.

Great. Thanks, Kate. We'll take the next question from Paul Cheng, please, at Scotiabank.

[ And Murray ], I just have to apologize. I want to go back into the offshore wind write-off. More of the question is that what we -- what have we learned from that; and how that, if any, changed the process of your FID on not just the wind -- offshore wind project but also on the alternative energy in general. Second with that, a quick question on the gas and low carbon sequentially, that the earnings dropped about $1 billion. How much of the decline is -- relate to the low carbon side of the business, if any?

Great. Learnings in offshore wind and alternative energy, I'll take. And then I'll let Kate take your second question. So I think what I'd say is, back in February, we talked that for offshore wind we were starting to pivot and focus offshore wind on integrated markets. That maybe wasn't what we did back in 2020 with the move in the United States. So I think we do like these integrated markets. We see the chance to make quite handsome returns on them as we move forward. We have our own natural demand for green electrons, which is enormous, especially in places like onshore Europe or the U.K. where there's not enough land for onshore solar or onshore wind. And obviously the taxation structures and the incentive structures are all to drive towards a greening economy, so we see that as the place that we should be doing offshore wind. It provides a natural sync. I think in Germany we've got 4 gigawatts that will be online by 2030. And obviously our demand is higher than that and growing significantly as we move through 2035. And the viewpoint is that we can develop these much cheaper than we can go out and buy a green PPA; making money on supplying it to our refinery, supplying it to our fast charging, supplying it to our trading business, to on trade around; and create an electron flow, much like we've created a gas flow over the past 60 years in our gas value chains. The last thing I'd say, Paul, is this will be capital light. We will firm these things down, probably down to the 25% to 35% level of ownership. We will use debt as appropriate to lever them, and as we do that, the capital deployed into these will be quite light. And we're very, very focused on the electron, as opposed to the capital itself. So I think that's the reflections. On solar, which would be the other bit that we do. Lightsource bp is doing very well. The returns are very high across the world for the develop-and-flip model that Lightsource bp has engendered. I think the average return, if I remember from -- looking backwards, '22 backwards, the average return on the flip model was around a 16% return, so very, very strong returns that have come out of -- I think it was [ 80 ] transactions was the last time I looked at it. So that continues to be a very good model that's working very well across Europe and Asia right now, a little bit sticky in the United States in 2023, but across the rest of the world, it's working very well. We'd expect the U.S. to return to normal in '24, '25. Kate, over to you on gas and low carbon.

Sure. Thanks, Murray. So Paul, it's a pretty straightforward story in terms of gas and low carbon quarter-on-quarter. It's all about gas trading. You've heard us say that we had exceptional quarters in gas trading in 1Q and in 2Q and then a weak gas trading result in 3Q. There's nothing really material to say about the low carbon results inside the quarter. It's all about the gas trading result.

Very good. We'll take the next question from Lucas Herrmann at BNP.

Craig, a couple, if I might. Murray, can you, can we just push into the customers & products business line a little bit more in terms of progress? I appreciate the marketing margins are under pressure given elevation in input costs, but I guess I'm wondering to what extent margins are also being -- or that business is also being impacted by the fairly aggressive build-out at the present time in EV and other markets. So just some better understanding because the numbers do seem modest, particularly given you've also had the [ travelers ] acquisition for the full quarter. And secondly, and apologies, I just want to go back to another comment that you made in response to a question Lydia asked in Denver, which was essentially where would you expect debt to fit by the end of 2025. And I think your comment was, in essence, low teens. I presumed that comment was made against your assumptions on where [indiscernible] would be and the assumptions that you outlie to us on what your expectations around price are across period. Sorry to ask something that's already a month old.

No, that's okay, Lucas. I'll tackle both of those since it was my quote in Denver. I think the question that Lydia asked was, "Where would you expect that to be at the end of 2025, all else being equal?" So that would be whatever the prices were in Denver on a forward strip basis and assuming a 60-40 allocation, yes. So that's how you get to the low teens when you think about that. So those are the assumptions that underpinned that question, Lucas, which is I think what you asked. And then on the C&P side: So convenience continues to grow very, very strongly. I think we're at 8% year-on-year growth, which is fantastic, and we continue to see strong progress in that space. EV charging is in line with our external promises. We plan to be breakeven by 2025. We have 2 nations, China and Germany, which are already breakeven well ahead of expectation. And uptake on EV charging is very, very strong. We're at over 10% utilization. Power sales have doubled across the years, so EV is going exceptionally well as well. So those are our 2 growth engines. I think the part of the C&P that's a bit tricky right now are retail margins. So that's on gasoline and diesel. In particular, we've seen an oversupply as we moved into late August, September and now October. And that's why you've seen the gasoline and diesel cracks moving down pretty significantly. Because of our weighting, that impacts us a little bit more than the average. Predicting how that will unfold in the future, I find very difficult, if I'm honest. There is not much excess capacity for gasoline and diesel around the world right now given the refineries that have shut down, so if we have outages, then all of a sudden, prices start to increase. So I think we'll -- I think calling that part of the business is as difficult to call as calling the oil price now, but we keep going back and forth between excess supply and shortages based on what's happening with outages across the world. So I think I'd -- I think the focus of it really is retail margins, because of oversupply, have been compressed. And that's what's impacting it. And that's what can change very fast, though, as we move forward, so I hope that helped that -- helped to unpack that a little bit before you, Lucas. Craig, back to you.

We'll take the next question from Peter Low at Redburn, please.

Just a couple of follow-ups. You mentioned that your CapEx is towards the lower end of the range because you've passed on some potential inorganic opportunities. I know you can't give any specifics, but can you say perhaps what business areas these were in, i.e., oil and gas or renewables and low carbon? And then just on the quarter itself, production did come in stronger than the flat quarter-on-quarter guide you gave at the last set of results. Can you give any color on what [ regions surprised ] positively and why?

Yes, great. I'll let Kate answer the "production upside in 3Q" question. On what inorganics aren't we pursuing: We're focused really on transition, if I'm honest, the transition growth engines, and not the oil and gas side. At $90 oil, I'm not sure it makes sense for us to pursue very many oil and gas transactions given the scale of our resource base that we have, so -- unless it's a fabulous opportunity, so it's really inside the transition growth engines. And it's focused on biofuels, convenience and electrification, the highest-return businesses we see, but we will continue to look at these things over time. As you know, our capital frame is a range of $14 billion to $18 billion through the decade. It includes organics and inorganics. And you can see that in -- our organic CapEx is running probably around $15 billion right now, somewhere around $14 billion to $15 billion per annum. So that gives you a sense of how we think about inorganic capacity. And if you look backwards, you can see the scale of what we've done through TAA, Archaea, EDF, et cetera in the past. So I hope that helps, Peter. Kate, over to you on production in 3Q.

Yes. Thanks, Peter. So production, I think, is doing really well. I'm really pleased with how our assets are performing across the portfolio. In particular, we've had really good performance in Gulf of Mexico. We've got Mad Dog 2, as I said, ramping up nicely. That will continue to ramp through the end of 2023. BPX, as you heard in Denver, is doing incredibly well right now. We've got great performance coming through on BPX, in particular on new well delivery. And of course, in the Gulf of Mexico, we've had a -- perhaps a quieter hurricane season than you might otherwise expect, but yes, it's doing really well. We're very pleased with our production performance to date. While I've got the microphone, perhaps I could just correct myself: Earlier, I talked about lag impacts. And I don't want you to overmodel the phasing of that into 4Q. It's closer to 400 million, not 800 million, so Michele, if you could just make a note of that, please. Thanks.

Thanks, Kate. Craig?

Thanks very much, Kate. We'll take the next question from Chris Kuplent at Bank of America.

Yes. And one quick follow-up; and then one, I apologize in advance -- a pretty tough question to ask you, Murray. The first one, you mentioned countercyclical M&A. You're always looking for opportunities. And I think we've talked quite a bit about the fact that you haven't spent as much inorganically. How about selling? Where do you see right now opportunities are in this market when you think about countercyclical activities? And where would you be a buyer or a seller across your portfolio? Without obviously wanting to talk specifics. And secondly -- and I appreciate that's slightly cheeky, Murray and Kate, but I noticed in your slide pack there was no more interim in front of your titles, so I just wanted to ask whether we need to congratulate you today; or when you expect us to have to congratulate you, hopefully not too far away from now.

We're both smiling and laughing at the second question, Chris. We remain Interim CEO and Interim CFO. And the Board is running its process and the Board will update you in due course. On M&A, so countercyclical. Obviously on the acquisition side we're focused on transition growth engines. Sometimes countercyclicals come up on the oil and gas side, though. So I mentioned the Australian opportunity that we had a few -- or last quarter -- or 2 quarters ago, I think. That's where we got access to a 14 tcf field for basically free. Those are the kind of things that we'll think about in the oil and gas space when they arise. As far as what we're selling, we've sold an awful lot of oil and gas sets over the past 15 years. Craig will get me right on the running tally, but I think we're over 120 billion of asset sales since 2010, so we have high-graded the portfolio materially. We've also dropped. If you go back to, I think, 2008, we've dropped from 20 refineries down to 6 to 7, so we've really gone through heavy high-grading over the past. As we look forward about what we'd high grade, obviously we'd be thinking about lower-margin businesses in the upstream or in the convenience space, the retail fuel space. Where others -- if it's late in life and others see more opportunity than we see, they've got lower investment hurdles than we see, then we might consider those type of divestments moving forward, but the overall level of divestments these days is pretty low now. We're -- $2 billion to $3 billion a year is all we're estimating right now and that's how we think about it moving forward, Chris. Thank you for the cheeky question. Love it.

We'll take the final question from Kim Fustier at HSBC. Thanks for your patience, Kim.

Yes. Firstly, I wanted to see if you could clarify what you mean by structure in the gas market. Does that mean you're making most of your money from trading time spreads? And so we should look at the shape of the TTF or JKM forward curves rather than extracting value from geographical spreads or prompt volatility. And secondly, just coming back to upstream production. You're guiding to flat volumes in Q4 versus Q3. And that's despite product ramp-ups such as Tangguh train 3. Is that because 3Q was such a high baseline? Or are there divestments or maintenance somewhere in the portfolio offsetting the project ramp-ups?

Great. Thanks, Kim. I'll tackle gas trading, and Kate can tackle production question for you. Look. We make money an awful lot of different ways inside our trading division, especially the gas trading division. We unpacked that a little bit in Denver a few weeks ago. I think the comment on 3Q is that we're seeing structural storage long, where I think we're at 98% full, as the latest data I've seen, inside Europe. So what that means is you might get a little bit of prompt volatility, but we're not a big paper trader in natural gas. So you might see a little bit of prompt volatility, but the structure, as you look out across multiple months was not moving because of that sheer length in storage. So that's what we mean by structural. The teams in the gas side make money from a lot of different things. They do it on geographic arbitrage. They'll do it on local arbitrage, on outages. They will do it on price spikes between prompt versus length, et cetera, so I think mainly it's an observation of what happened in 3Q and what we've obviously seen in October so far. It's just a situation where inventories are very full in Europe. Inventories are quite full in the United States, and that just means there is much less money to make on volatility. So I hope that makes some sense. And we'll pass over to Kate for the last question, on production.

Yes. So thank you, thanks, Kim. So I think -- in terms of 4Q volumes, yes. So 3Q was strong. In 4Q, we typically have a level of seasonal maintenance that you'll see coming through our portfolio. You'll see that coming through the volumes in 4Q. This is a big part of why we're guiding that production will be broadly flat quarter-on-quarter. I think I mentioned earlier you still have the PSA entitlement impacts, but those 2 components, the seasonal maintenance and the impacts of PSA, are part of what creates the volume forecast for the fourth quarter and the fact that it's pretty flat. And let's see what the weather situation does in the Gulf of Mexico. At the moment, that's looking fairly quiet, so we'll keep our fingers crossed on that front too. Thanks, Kim.

Very good. Kate, Murray, thanks very much. That's the end of the questions. Maybe, on that note, let me hand back to Murray for closing remarks.

Great. Thanks, Craig. And thanks, Kate. And to the audience on the web, thanks very much for listening. I'd just like to recap 3Q in our minds. It was a strong operational delivery and strong cash delivery. We're very proud of the safety track record that we see of continuing reduction in Tier 1 events. 96% plant reliability in the refineries and in the upstream facilities is an amazing result, as is declining unit costs in an inflationary environment. And production volume growth of 3% year-on-year, year-to-date, I don't think there's anybody else in large-scale companies doing that type of growth, so we're very happy with performance and cash delivery as well. And what we're focused on moving forward is safely continuing to deliver quarter-on-quarter performance and delivering the strategy we laid out to the market for hitting our 2025 targets and our 2030 aims. And with that, we'll look forward to talking to you again in the new year, in February, where I think we'll be hosting maybe from a different place in the United States. So we look forward to that in due course. Thanks, everyone. Bye-bye.