Offshore


A week after British oil and gas giant BP announced its plan to transition from mainly an oil operator into a clean-energy giant, the company saw its share price drop to a 25-year low.

BP’s shares in London on Thursday stood at 232.4p, the lowest they have been since October 1995.

The development follows the efforts of BP chief executive officer Bernard Looney and the management team, who dedicated more than 10 hours of presentations, to show that the company could adapt to a net-zero future without sacrificing returns.

BP hits 25-year low a week after unveiling a new climate strategy - oilandgas360

At the beginning of last month, BP announced its aim to increase its low carbon investment 10-fold by 2030, with an increase of up to 8-fold by 2025. Source: BP

Looney promised investors that while BP is reinventing its operational focus, delivering returns could average 8% to 10%, which is significantly less than the standard returns oil developments can bring.

Despite the fact that, according to Bloomberg, slumping oil prices and fears of a second Covid-19 wave significantly impacted BP’s work, the share plummet suggests that shareholders weren’t convinced by Looney’s pitch.

Aviva Investors global head of governance Mirza Baig said: “Investors remain sceptical. Particularly as this move is being forced on the company by climate change.”

The news comes a week after BP announced its plans to partner with Microsoft, using its cloud computing service Azure, to develop new technology innovations and ‎digital solutions to help reduce energy use ‎and carbon emissions.

As BP set a strategy for a decade of delivery towards net-zero goals, the operator will also aim to supply Microsoft with renewable energy to help meet the technology company’s renewable energy goals as soon as 2025.

At the beginning of last month, BP announced its aim to increase its low carbon investment 10-fold by 2030, with an increase of up to 8-fold by 2025. It also unveiled plans to partner with 10-15 cities and three core industries in its decarbonisation efforts, while doubling customer interactions to 20 million per day, all by 2030.


Legal Notice