Oil major faces green fight

The succession to Bernard Looney as chief executive of BP was always going to be an inside job, although chairman helge Lund was obliged to look at outsiders. The choice of Canadian Murray Auchincloss, who joined BP when Lord John Browne’s BP bought Amoco in 1998, is only unusual in that he was previously finance director rather than a driller.

That is not in BP’s playbook. Auchincloss, we are told, is in a personal relationship with another BP colleague.

But we are assured, this time, the board, which failed miserably when appointing Looney, has been thorough in its checks and full disclosures have been made.

The identity of his partner, with whom he has a child, remains under wraps.

What any of this has to do with BP income, the share price and strategy is worth asking. But in the age in which we live, the personal lives and character of top executives are deemed as relevant as performance.

BP’s board had no choice but to come down hard on Looney’s failings.

There was also the suspicion that everyone in the room was not entirely simpatico with his mission to make BP the greenest of the oil majors. Amid surging energy prices in 2023 Looney diluted his pledge to cut fossil fuel output by 40pc by 2030.

he lowered the target to 25pc. All the early signals are that in spite of many oil majors doubling down on fossil fuels, Auchincloss intends to stick with the Looney approach.

The new chief executive intends to be much more focused on value for money for investors. That could mean green projects, which fail to make adequate returns, could struggle. What is emphasised is that BP’s commitment to the UK, both fossil fuel and green, remains with £18bn of new investment running up to 2030.

BP is seeking to disabuse the idea that oil and gas development is off its agenda.

Last June, BP America spent £3bn snapping up US natural gas explorer Archaea.

This is hardly comparable with exxon Mobil’s £47bn swoop on Pioneer in Texas’s Permian Basin.

Shell also remains committed to fossil fuels in spite of a decision to sell its onshore oil production in Nigeria after 68 years.

That followed the exit of other oil majors amid problems with pipeline theft, kidnapping and environmental criticism.

Shell has not given up on UK offshore in spite of political opposition from Labour and the Scottish nationalists.

It is ploughing resources into the Victory gas field north-west of the Shetland Isles, with the capacity to eventually heat up to 900,000 UK homes a year.

Big battalion investors preach the environmental creed. But they will be anxious to make sure that the new BP chief doesn’t lose sight of the fossil fuel cash machine.

Growth funding

ONe post-Brexit myth is that Britain is no longer a draw for overseas investors.

evidence of undiminished demand for UK funds investing in high-tech comes from London-based Bowmark Capital, run by financier Charles Ind, which has just completed a £900m fundraising.

Some 31 institutional investors from across the globe, 48pc from Continental europe and 37pc from North America, chose to pile in. The disappointment is that UK asset managers appear reluctant to be bold investors, prepared to back the UK’s future tech champions. They provided only 8pc of the new money.

Bowmark’s current portfolio includes fintech outfits such as Landscape, provider of secure lending services to 120 banks across the world, political intelligence powerhouse Dehavilland and Xperience, which specialises in digital transformation.

The new fund plans further investment in growth firms offering data, IT, software and tech business services.

The big challenge for the Government, whatever its colour, is to unlock the UK’s pension fund billions and back innovation and productivity.

Life saver

GSK’s transformation as a pure life sciences company continues apace with the purchase last week of the Anglo-American biotech enterprise Aiolos Bio, strengthening its reach in chest medicines.

Deals have to be paid for and chief executive emma Walmsley has bolstered the cash position by selling down, at a discount, its stake in former consumer healthcare offshoot haleon, raising £978m.

how long before the remaining 4.2pc stake goes under the hammer?