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BP Freezes Hiring And New Wind Projects
https://www.whatjobs.com/news/united-kingdom/uk-employment-news/bp-freezes-hiring-and-new-wind-projects
By Nithya Bose in Business News, posted June 28, 2024
BP has implemented a hiring freeze and halted new offshore wind projects to appease investors who are dissatisfied with the company's green targets.
Murray Auchincloss, who became CEO in January following Bernard Looney's unexpected departure, is focusing on delivering shareholder value.
Looney was committed to aggressive climate goals.
However, he was ousted for not disclosing relationships with colleagues.
The shift in BP's strategy raises concerns about the future of Looney’s plan to transition the company away from fossil fuels and achieve net zero by 2050.
Shareholders have pressured BP due to the high costs of renewable projects.
Earlier this year, BP adjusted its goals, planning to cut oil and gas production by 25 percent between 2019 and 2030.
This is down from an earlier 40 percent target.
Greenpeace UK criticised the move.
Joint executive director Areeba Hamid expressed disappointment Auchincloss chose to follow other fossil fuel companies in prioritizing short-term profits over long-term climate solutions.
Reports suggest Auchincloss is exploring investments in new oil and gas assets.
These are in the Gulf of Mexico and Texas shale basins.
This follows a trend seen with BP’s competitor Shell, which recently scaled back its green ambitions.
Shareholders have pressured BP due to the high costs of renewable projects
Shell has reduced staff in low-carbon roles and increased focus on high-profit oil projects.
Alice Harrison of Global Witness condemned BP's actions.
It accused the company of prioritising profits over climate commitments since the energy crisis began yielding record profits.
BP has built a offshore wind portfolio capable of generating 9.5 gigawatts of energy in the UK, Germany, and US.
However, it plans to focus on its existing assets rather than pursuing new renewable projects.
It is looking to reallocate personnel from new renewables opportunities to offshore wind projects in Britain and Germany.
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Some job cuts in renewables are anticipated, although the hiring freeze will have exceptions for frontline roles.
BP's shares rose slightly on Thursday, June 27, despite underperforming its rivals recently.
This led to speculation about a potential takeover.
While BP continues to invest in biofuels and low-carbon businesses, it is scaling back plans for new biofuel projects.
This is proved by its recent $1.4 billion deal to take full ownership of a Brazilian sugar and ethanol joint venture.
BP affirmed its commitment to transforming into an integrated energy company, emphasising a simpler, more focused, and higher-value approach.
Auchincloss has pledged a "more pragmatic" strategy.
This aims to cut $2 billion in costs by 2026 and focus on fewer new projects in the coming years.
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