The Press and Journal (Aberdeen and Aberdeenshire)
Fossil fuels ‘smaller, but core’ part of BP business
● Hydrocarbons to be ‘engine of value creation’ in net-zero drive
BP’s chief executive, Bernard Looney, said yesterday that oil and gas would be a “smaller, but core part” of the business as it “pivots” to net zero.
Mr Looney said BP’s oil and gas production would drop by 40%, or one million barrels of oil equivalent per day, over the next 10 years.
But he described hydrocarbons as an “engine of value creation” that would help pay for BP’s transformation from an international oil company to an “integrated energy company”.
A former UK North Sea boss at BP, Mr Looney also said that while the company was targeting divestments of £19 billion by 2025, he would take time to find “value”.
BP has sold stakes in a number of North Sea oilfields in recent years, including Bruce and Magnus, with Andrew soon to follow.
At the same time, BP has invested billions of pounds in the Schiehallion and Clair fields, west of Shetland.
Mr Looney’s comments came after BP published its first-half results, which showed huge losses, and announced it was cutting its dividend in half to free up cash for low-carbon investments.
Unveiling its new strategy, BP pledged to slash fossil fuels production and reduce emissions from its operations by about a third in 10 years. It will invest 10 times more in low-carbon technologies like hydrogen and carbon capture, taking it to £3.8bn a year.
BP also aims to have developed around 50 gigawatts of net renewable generating capacity, a 20-fold increase from 2019 levels.
The plans were wellreceived by investors, with BP’s share price rising by more than 5%.
Mr Looney said BP was moving “earlier, faster, further and more decisively” on its strategy.
He acknowledged BP was “in a different place” due to Covid-19, but is “convinced” the net-zero direction he chose after taking up the reins in February was right.