BP scraps strategy of reducing hydrocarbon production, will produce more oil and gas

British energy company BP is definitively abandoning its strategy of reducing hydrocarbon production and will instead focus more on oil and gas production. It will increase investment in production to ten billion dollars (240 billion Kč) a year. The company announced this today in its updated long-term strategy, which marks a major shift from its previous plans.

In its long-term strategy in 2020, the company outlined the most ambitious plans in the industry. It promised, for example, to cut oil and gas production by 40 percent by 2030 and accelerate renewable energy production. Those plans have now been abandoned. Instead, it will devote less attention to renewable energy.

The return to fossil fuels is part of a plan outlined last year by BP chief executive Murray Auchincloss. His strategy envisages the company focusing more on delivering economic benefits to shareholders and improving its overall financial performance. The company has sharply cut planned investment in activities related to the energy transition, by more than USD 5 billion compared with its original plans. It will now spend 1.5 to two billion dollars a year on them.

„We will increase investment in exploration and production, enabling us to produce high-margin energy for years to come. In refining, we will focus on markets where we have an overall leading position,“ Auchincloss said.

Under its previous chief executive, Bernard Looney, the company set out plans to move away from fossil fuels and rapidly increase renewable energy production, but gradually scaled back its original ambitions. Although the 2020 strategy envisaged cutting oil and gas production by a total of 40 percent by 2030, in 2023 the company’s management changed the plan and eased the target for reducing hydrocarbon production to 25 percent.