A leading London activist investor group is pressuring oil giant BP to ditch renewable energy and maintain its fossil fuel operations for shareholders, reports suggest.The Financial Times this morning reported that Bluebell Capital Partners wrote to BP chair Helge Lund in October after taking a small stake in the company.The letter decried BP’s commitment to reduce oil and gas production by 25 per cent by 2030 against 2019 levels as an “irrational strategy” that has depressed its share price.
The target is a legacy commitment from former chairman Bernard Looney, who resigned last year over inappropriate relationships with colleagues.Looney initially committed to a 40 percent reduction in output by 2030 but walked that back to 25 percent cut last year citing pressures from the Russia-Ukraine war.His successor, former chief financial officer Murray Auchincloss, said upon his appointment two weeks ago that he would maintain the strategy moving forward.
BP has come under criticism in recent years for its share price falling behind that of its direct competitors such as Shell, Exxon and Chevron.Bluebell’s letter continued that the oil major should cut $28bn of funding to bioenergy, hydrogen and renewable projects – equating to 60 percent of allocated budget.BP has “no right to win” in the renewable energy market, the hedge fund added.
Bluebell describes itself as an activist investor group that focuses on large cap European public equities and has previous for trying to influence companies in which it has a stake.Before Glencore acquired Teck Resources’ thermal coal business last year, the fund unsuccessfully campaigned the Swiss mining group to exit the thermal coal market.BP has been approached for comment.
Source:https://oilprice.com