BP has recently published its strategy for fulfilling its commitment to becoming a net-zero emissions integrated energy company by 2050, signalling a shift away from its traditional oil and gas business and towards renewable energy generation.
Over the coming decade, BP expects to massively ramp up its investment in low-carbon technologies, such as biofuels, hydrogen and renewables, as well as carbon capture, utilization and storage (CCUS). This budget will increase eightfold by 2025 and tenfold by 2030 to reach $5 billion per year.
While the company moves into emerging energy sectors, its traditional oil and gas business will be gradually downsized, as it points out in its press release:
“Over the same period, bp’s oil and gas production is expected to reduce by at least one million barrels of oil equivalent a day, or 40%, from 2019 levels. Its remaining hydrocarbon portfolio is expected to be more cost and carbon resilient.”
While oil will still be needed for many products, such as petrochemicals and industrial products like Castrol Magna slideway oil, the reduced levels of production likely reflect an anticipated lower demand for transport fuels in future, as the adoption of electric vehicles increases and electricity generation shifts away from gas to renewables sources, including wind and solar.
For its remaining upstream operations, BP expects to reduce the associated carbon emissions by 30-35% and 35-40% as parts of Aim 1 and Aim 2 respectively, with the remaining emissions presumably being offset by its investment in low-carbon projects.