BP on Friday launched a process to market its North Sea business as the UK-based supermajor looks to simplify its portfolio and invest in high-return projects.
The formal launch of a potential sale comes after months of speculation that BP would be divesting part or all of its operations in the UK North Sea to focus on reserve growth and long-term production opportunities outside the UK.
“The decision forms part of bp’s ongoing portfolio review and reflects its disciplined approach to capital allocation – all in service of creating a simpler, stronger and more valuable company,” the supermajor said in a statement today.
“The North Sea remains integral to the UK’s energy system. However, as we focus our portfolio and direct capital to our highest-value opportunities, we believe our North Sea business will be better positioned as part of another company,” chief executive officer Meg O’Neill said.
“It has world-class people, resilient assets and a proud heritage, and it is precisely these qualities that can attract an owner ready to back its next chapter. We are seeking an outcome that recognizes that value.”
Earlier this month, O’Neill said that BP had started to simplify its portfolio and cut costs, and would make fewer but better choices in which projects to invest.
“We are taking concrete action to grow long-term value for shareholders: simplifying our portfolio, reducing costs, maintaining tight discipline on capex and strengthening the balance sheet,” O’Neill, the first female CEO of a Big Oil company, wrote in a LinkedIn post to reflect on the first 100 days as top executive of BP.
“We need to be deliberate about where we invest and where we don’t. We need to make fewer, better choices and hold ourselves to account,” O’Neill wrote.
BP has remained the last supermajor to have neither sold nor combined its UK North Sea business in recent years. Shell and Equinor combined their oil and gas assets in a standalone company, Adura. TotalEnergies merged its assets with NEO NEXT to create NEO NEXT+, in which the French supermajor holds a 47.5% interest.
By Tsvetana Paraskova for Oilprice.com
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