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Ladies and gentlemen, a warm welcome to BP’s second-quarter results for 2009. Before I start I would like to remind you all of the usual cautionary statement. Let me begin with the overall business and trading environment. As all of you are well aware, it’s been a pretty turbulent few months, best characterised by continued uncertainty and volatility. I’m pleased to say that BP continues to steer a steady course through choppy waters. Two years ago we set out on a journey to re-establish BP’s competitiveness and, despite the current

Ladies and gentlemen, a warm welcome to BP’s second-quarter results for 2009. Before I start I would like to remind you all of the usual cautionary statement. Let me begin with the overall business and trading environment. As all of you are well aware, it’s been a pretty turbulent few months, best characterised by continued uncertainty and volatility. I’m pleased to say that BP continues to steer a steady course through choppy waters. Two years ago we set out on a journey to re-establish BP’s competitiveness and, despite the current

* BP's third-quarter replacement cost profit was $4,981 million, compared with $10,029 million a year ago, a decrease of 50%. For the nine months, replacement cost profit was $10,508 million compared with $23,006 million a year ago, down 54%. * Non-operating items and fair value accounting effects for the third quarter had a net $307 million favourable impact compared with a net $1,147 million favourable impact in the third quarter of 2008. For the nine months, the respective amounts were $315 million favourable and $632 million unfavourable - see further details on page 2.

The BP Board is responsible for the direction and oversight of BP plc (BP) on behalf of theshareholders and is accountable to them, as owners, for all aspects of BP’s business. The Board recognises that in conducting its business, BP should be responsive to other relevant constituencies. The BP Board believes that good governance involves the clarity of roles and responsibilities, and the proper utilisation of distinct skills and processes. The Board therefore focuses on activities that enable it to promote shareholders’ interests, such as the active consideration

The directors are responsible for preparing the Annual Report and the consolidated financial statements in accordance with applicable United Kingdom law, International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board and IFRS as adopted by the European Union. The directors are required to prepare financial statements for each financial year that present fairly the financial position of the group and the financial performance and cash flows of the group for that period. In preparing those financial statements, the directors are required to:

The board undertook extensive discussions on strategic options for the group, including the future business and competitive environment, technology developments, pricing and demand models and portfolio options. The identification and management of group risks were reviewed by the board, together with how these risks and their mitigation were embedded in thegroup’s annual plan. I am once again pleased to introduce ourboardperformancereport. The report reviews the work of theboard and itscommitteesas my tenure as chairman moves to a close. Over the past12years,both the calibre of

2008 was a year we will all remember. There are few precedents in history for such a rapid and dramatic change in the business environment. In the space of a few months we went from a record oil price of more than $140 per barrel, and BP reporting two consecutive quarters of record profi ts for the group, to a recession in most of our major markets. Despite this changing environment, I am glad to say that BP is in an enviably strong position in terms of its balance sheet, its assets and its people.

BP executives delivered a strong performance in a turbulent environment during 2008 and restored the group’s operations to a high standard after several years of focused effort. We commend them for a job well done. Key financial targets for the year were exceeded, even after adjusting for the effect of high oil prices during part of the year. Safe and reliable operations remained at the top of the agenda and key safety metrics and milestones were achieved. The year’s results were especially strong in Exploration and Production, with the start-up of the Thunder