BP will Pursue Acquisitions Aggressively to Implement Its New Strategy

Sinopec News, August 11, 2020 - Oil giant BP (BP) will embark on a major acquisition and divestment drive to implement a new strategy after announcing its strategy to transform itself from an international oil company to an international energy company, according to Arab Trade on August 7.

"BP has set ambitious targets to restructure its business within a five - and 10-year timeframe," said WillScargill, managing director of Oil and gas analysts at GlobalData. A reform of this scale would require significant changes in the M&A market if it is to be achieved within the target time frame."

He said: "BP's renewable capacity targets are a big issue in its low carbon energy growth plan. Currently, its most important renewable energy stake comes from its 50% stake in LightSource BP, which aims to generate 10 GIGAwatts of electricity by 2023. To reach 20GW by 2025 and 50GW by 2030, a number of acquisitions are likely to be needed in addition to the increased capital spending BP has already set out.

Mr Scargill added: "In its traditional oil and gas business, BP will need to shed non-performing assets to meet its goal of increasing return on capital by reducing its asset base. On top of its previous divestment target of $15 billion, the company plans to divest $25 billion over the 2020-25 period."