Sydney — BP is probably the first oil major that has made concrete plans for the end of oil — or at least the shrinking of its role. The company announced a big strategic pivot in August that would see it turn from an “integrated oil company” to an “integrated energy company”.
This time might be different. BP plans to cut its oil and gas output by about 40% over the next decade and increase its renewable energy generation capacity 20-fold. It’s also given up on luring investors with the high dividends of the past, cutting its payout in half and lowering its expected returns on capital from the low- to mid-double digits that conventional oil once achieved to a more modest 8% to 10%, closer to what big renewable energy investments yield.
Selling off oil and gas fields is likely one way BP will cut its output in the coming decade. Other cuts will come from the natural depleting of its reserves The commercial part of BP’s rationale was underlined earlier this week with the publication of the company’s latest annual “outlook”, which projects long-term scenarios for how the energy landscape will change. Even in BP’s worst case for the climate — that is, the best case for oil — demand for the polluting fuel will stop growing within a few years, much sooner than most energy forecasters expect. The International Energy Agency still sees growth until at least 2030 in its central scenario.
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BP to become integrated energy company as it moves away from oil and gasBP makes concrete plans for the end of oil, with plans to increase its renewable energy generation capacity 20-fold over the next decade
Source: BDliveSA - 🏆 12. / 63 Read more »
BP to become integrated energy company as it moves away from oil and gasBP makes concrete plans for the end of oil, with plans to increase its renewable energy generation capacity 20-fold over the next decade
Source: BDliveSA - 🏆 12. / 63 Read more »