Energy giant BP (LON: BP) is reportedly imposing a hiring freeze and pausing new offshore wind projects amid investor discontent over its low carbon strategy.
Reuters reported newly appointed BP chief executive officer Murray Auchincloss is planning to slow the firm’s investment in large low carbon projects, particularly in offshore wind, and place a renewed focus on oil and gas investments.
The move marks a reversal of the company’s strategy under former CEO Bernard Looney, in which BP announced plans to become a net zero company by 2050.
It also mirrors a similar renewables retreat from competitor Shell (LON:SHEL), which recently watered down its 2030 emissions targets.
BP has faced discontent from investors over its strategy, amid increasing pressure from some shareholders to raise its profitability and narrow the valuation gap with more oil-focused US rivals.
© Supplied by DCT MediaAlongside a pause in new offshore wind projects, BP is also expected to make job cuts in its renewables department amid a company-wide hiring freeze.
In May, Mr Auchincloss announced a £1.6 billion cost cutting drive as its profits lagged behind rivals Shell, Exxon and Chevron.
Under Mr Auchincloss, the firm has also said it will step back from sanctioning major projects and acquisitions.
BP remains the only oil supermajor to have oil and gas output reduction targets, but last year the company reduced its target from a 40% cut to 25%.
A BP spokesperson told Reuters the company is aiming “to deliver as a simpler, more focused and higher value company”.
“The actions we are taking are part of delivering this – and of course are all in service of our aim of growing the value of BP,” the statement said.
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- Source: https://www.energyvoice.com/oilandgas/north-sea/555964/bp-reportedly-pressing-pause-on-offshore-wind-amid-investor-discontent/