The British oil group BP is taking an unexpected direction. After years of ambitious announcements to reduce its carbon footprint, British Petroleum announced on December 9, 2024 a reduction in its investments in renewable energies.
For several years, BP has been at the head of the major oil companies displaying their commitment to the energy transition. However, the announcement of a significant reduction in its investments in renewable energies for the years to come sent a shock wave. Why this change of heart?
Renewable energies : the Jera Nex BP joint venture: promise or compromise?
BP stood out in 2020 with an ambitious objective: achieving carbon neutrality by 2050. This audacious plan was part of a series of measures to reduce dependence on hydrocarbons and develop renewable energies. However, by 2023, a slowdown in these efforts was perceptible. According to a spokesperson for the group, this change aims to improve the profitability of projects, an aspect where offshore wind power seems to be struggling. BP now plans to cut its oil and gas production by 25% by 2030, compared to 40% initially promised.
The partnership with the Japanese Jera was announced at the same time. London-based Jera Nex BP will consolidate 13 GW of offshore wind assets, but BP's investments in this area will be drastically reduced. Of the $5.8 billion committed, BP will contribute $3.25 billion. This amount is much lower than initial forecasts, marking a transition towards less capital-intensive projects, but promising rapid returns.
Investor pressure, an invisible force
The stock markets immediately reacted to this announcement: BP shares jumped more than 3.5% on the London Stock Exchange. This strategic turnaround responds to growing criticism from shareholders, who considered investments in renewable energies “irrational” in the face of more predictable margins in hydrocarbons. Russ Mould, analyst at AJ Bell and interviewed by AFP, underlines that this choice reflects a search for direct return to attract disappointed investors.
BP is not alone. Shell, its British competitor, also announced that it was stopping developing new offshore wind projects. TotalEnergies in France and ExxonMobil in the United States also adopt strategies focused on fossil fuels. The argument? Demand remains strong for oil and gas, and returns on investment are more secure.
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