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* 2018 profits rise to $12.7 billion
* Net debt, gearing rise after BHP acquisition
* BP's net oil and gas production grows by over 8 percent(Recasts, updates throughout)
By Ron Bousso
LONDON, Feb 5 (Reuters) - BP's profit doubled to$12.7 billion in 2018, driven by strong growth in oil and gasoutput following the acquisition of a large portfolio of U.S.shale assets.
The company's debt rose however, and the pace of its sharebuyback scheme slowed in the last quarter as it completed the$10.5 billion BHP acquisition.
"We now have a powerful track record of safe and reliableperformance, efficient execution and capital discipline. Andwe’re doing this while growing the business," BP Chief ExecutiveOfficer Bob Dudley said in a statement.
Rivals Royal Dutch Shell, Exxon Mobil andChevron all reported stronger-than-forecast earningslast week driven by higher production in U.S. shale basins whereOil Majors have invested billions in recentyears.
BP, like its competitors, wrapped up 2018 on a strong notedespite a sharp drop in crude prices at the end of the year thatwiped out most gains made in share prices throughout the year.
Uncertainty over the outlook for oil prices as well asconcerns over global economic growth and sino-American tradetensions also continued to weigh on the sector.
After settling the vast majority of payments for the deadly2010 Deepwater Horizon spill in the Gulf of Mexico, totallingnearly $70 billion, BP has more recently focused on growingproduction into the next decade, including the BHP deal which isits largest in 30 years.
Fourth-quarter underlying replacement cost profit, thecompany's definition of net income, reached $3.5 billion,exceeding a company-provided forecast of $2.63 billion.
That compared with a profit of $2.11 billion a year earlierand $3.84 billion in the third quarter of 2018.
For the year, BP's profit rose to $12.7 billion, double theprevious year's $6.17 billion. Analysts expected 2018 profits of$11.88 billion.
BP's production rose in 2018 to 3.7 million barrels of oilequivalent per day after it completed the acquisition of BHP'sonshore U.S. shale portfolio and thanks to the start up of newfields including the 120,000 barrel per day Clair Ridge projectin the North Sea.
Excluding its share of production from its 20 percent stakein Russia's Rosneft, BP's production was up 8.2percent from 2017.
Gearing, the ratio between debt and BP's market value, roseto to 30.35 percent at the end of 2018 from 27.4 percent a yearearlier. Net debt was $44.1 billion at the end of last year.
Cashflow for 2018 reached $26.1 billion, including a $2.6billion gain due to inventory sales, compared with $24.1 billionfor 2017.
(Reporting by Ron Bousso, editing by Louise Heavens and KirstenDonovan)
