THE new CEO of BP, Murray Auchincloss, has put a halt on new offshore wind projects and has implemented a freeze on new hires as he shifts his focus back to oil and gas. These strategies are anticipated to cut costs by at least $2 billion by the year’s end.
The company will not be putting in bids for new offshore wind projects, and, except for essential positions, such as those at well sites and in safety-critical roles, the company is stopping the recruitment process.
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Information from within the company has been shared with Reuters, indicating that this shift will decelerate investments in high-cost, low-carbon projects that are not projected to yield profits soon.
These sources also mentioned that there’s a growing focus on buying new oil and gas properties, especially in the Gulf of Mexico and US shale fields, where BP already has a significant presence. This change marks a departure from BP’s strategy under Bernard Looney’s leadership, which aimed to quickly transition away from the use of fossil fuels.
BP’s current aim is to reduce emissions by 25% of 2019 levels by 2030. That in itself has already been lowered from the 40% reduction target announced by Mr Looney in 2020.
Mr Auchincloss said last month that turning the “aims” into formal targets would be “pragmatic and returns driven”.
“As we make those decisions, which will be very returns driven, we will start to formalise what the 2030 targets are. Could production be higher than two million a day? Yes. Could it be lower? Yes. It could go in either direction,” he added.
In a statement to Reuters, the firm said the CEO has introduced sic priorities to “deliver as a simpler, more focused and higher value company”.
A spokesperson added: “We set out six priorities that underpin this including driving greater focus into the business onto activities that create the most value, as well as delivering both the next wave of efficiencies and BP’s growth projects.”
