bp announces plans to increase spending on bioenergy

bp has announced plans to increase the proportion of capital expenditure in transition growth businesses, including bioenergy, to more than 40% by 2025.

bp provided an update on its strategic transformation on 8 February, including accelerating its net-zero ambition, as part of its full-year results for 2021. The company reported an annual profit of $12.85 billion (€11.2 billion) last year – its highest in eight years.

The strong progress bp has made over the past few years has reinforced its confidence in the delivery of its earnings and returns targets for 2025. Additionally, it is aiming to grow EBITDA through to 2030.

bp aims to generate earnings of $9-10 billion (€7.8-8.7 billion) from transition growth businesses by 2030, driven by five transition growth engines – bioenergy, convenience, electric vehicle charging, renewables and hydrogen.

As the world seeks lower carbon fuels, bp sees clear opportunities to leverage its portfolio of assets and customer base, which is why bioenergy is one of the firm’s transition growth engines. This includes biofuels, including sustainable aviation fuel, and biogas.

Building on its refinery footprint, bp anticipates investing in five major biofuels projects, including the conversion of up to two refineries. It also sees an opportunity for “considerable growth” in biogas in the US, Europe and the UK.

“Over the past two years, we have set a new purpose, direction and strategy for bp, and completed the largest re-organisation in our history,” said bp’s chief executive, Bernard Looney.

“With this period of change fully behind us, we are now solely focused on driving value through the safe, efficient delivery of our strategy.

“We enter 2022 with growing confidence. The past two years have reinforced our belief in the opportunities that the energy transition presents - to create value for our shareholders and to get to net zero.

“The need for, and role of, an integrated energy company has – to our minds – never been clearer. Underpinning all of this is our steadfast commitment to perform while transforming.”