Feb 20 | 2020
(Global) Oil Giant Plans Increase in Non-oil Outlay
Energy major BP's incoming CEO has announced plans to "reinvent" the company, signaling large-scale investment in non-oil projects.
The move is a significant revision of the group’s previous strategy and is expected to present opportunities for breakbulk operators across the energy sector. New CEO Bernard Looney took over the top post at the energy giant earlier this month.
“We need to reinvent BP. Our historic structure has served us well but… we are undertaking a major reorganization, introducing a new structure, a new leadership team and new ways of working for all of us.” Looney stated.
Commenting on the announcement, Luke Parker, vice president, corporate analysis at consultancy Wood Mackenzie, called the move “a major turnaround in BP’s position. Just 12 months ago former CEO Bob Dudley said the company could not be held accountable for how people use its products. Looney is taking the company in a very different direction.”
Carbon Neutral 2050
The new structure will see BP increase the proportion of investment it makes into non-oil and gas businesses, with a goal of becoming entirely carbon neutral by 2050.
“These will be absolute reductions, which is what the world needs … the whole energy system has to be transformed and everyone has a contribution to make – producers and sellers of energy, policy makers and everyone who uses energy,” Looney said.
Growth in offshore wind is forecast to be an important driver for breakbulk demand over the next two decades, as the scale of wind farm components increases.
Trillions of Dollars in Investment
Forecasting that trillions of dollars will be invested in "replumbing and rewiring" the world’s energy system, Looney pledged the group’s commitment to supporting a range of vital new infrastructure.
“We expect to invest more in low-carbon businesses – and less in oil and gas – over time. The goal is to invest wisely, into businesses where we can add value, develop at scale, and deliver competitive returns … This will certainly be a challenge, but also a tremendous opportunity,” Looney concluded.
One of the world’s seven oil and gas "supermajors," BP operates in nearly 80 countries, producing about 3.7 million barrels of oil equivalent per day.
The move is a significant revision of the group’s previous strategy and is expected to present opportunities for breakbulk operators across the energy sector. New CEO Bernard Looney took over the top post at the energy giant earlier this month.
“We need to reinvent BP. Our historic structure has served us well but… we are undertaking a major reorganization, introducing a new structure, a new leadership team and new ways of working for all of us.” Looney stated.
Commenting on the announcement, Luke Parker, vice president, corporate analysis at consultancy Wood Mackenzie, called the move “a major turnaround in BP’s position. Just 12 months ago former CEO Bob Dudley said the company could not be held accountable for how people use its products. Looney is taking the company in a very different direction.”
Carbon Neutral 2050
The new structure will see BP increase the proportion of investment it makes into non-oil and gas businesses, with a goal of becoming entirely carbon neutral by 2050.
“These will be absolute reductions, which is what the world needs … the whole energy system has to be transformed and everyone has a contribution to make – producers and sellers of energy, policy makers and everyone who uses energy,” Looney said.
Growth in offshore wind is forecast to be an important driver for breakbulk demand over the next two decades, as the scale of wind farm components increases.
Trillions of Dollars in Investment
Forecasting that trillions of dollars will be invested in "replumbing and rewiring" the world’s energy system, Looney pledged the group’s commitment to supporting a range of vital new infrastructure.
“We expect to invest more in low-carbon businesses – and less in oil and gas – over time. The goal is to invest wisely, into businesses where we can add value, develop at scale, and deliver competitive returns … This will certainly be a challenge, but also a tremendous opportunity,” Looney concluded.
One of the world’s seven oil and gas "supermajors," BP operates in nearly 80 countries, producing about 3.7 million barrels of oil equivalent per day.
