UK-based global fossil fuel giant BP plc has officially unveiled its latest “reset” strategy, which will see the company refocus on upstream oil and gas operations to produce high-margin energy. It has also announced plans to sell its stake in solar PV subsidiary Lightsource bp.
BP became the sole shareholder of Lightsource bp in October 2024, at which time the subsidiary had a reserve of 62GW of solar PV projects across 19 markets globally, aimed at meeting the company’s demand for low-carbon, cost-competitive electricity. However, just five months after the acquisition, BP indicated plans to bring in partners to aid Lightsource bp’s growth and intended to earn $20 billion through a strategic review of its long-standing lubricants business, Castrol.
BP has pledged to continue investing 10 billion annually in its oil and gas business until 2027 and to cut its investment in renewable energy to 1.5 billion to 2 billion, down significantly from previous plan of 5 billion. BP CEO Murray Auchincloss stated that the company would focus on long-term shareholder value growth: “We will reduce and reallocate capital expenditures, focusing on the highest-return businesses to drive growth and continuously pursue performance improvements and cost efficiencies. All these are aimed at consistently growing cash flow and returns.”
BP indicated that it would adopt a more “disciplined” approach to investment. In the future, the company will make light-capital investments in top-tier offshore wind and solar platforms and limit further investments in projects such as hydrogen and carbon capture. According to Reuters, BP’s strategic adjustment stems from its underperformance compared to competitors Shell and ExxonMobil. Additionally, US activist investor Elliott Investment Management has acquired a 5% stake in BP. It is reported that Elliott Investment Management is pushing BP to divest assets, particularly in the low-carbon sector, while implementing cost reductions and performance transformations.
