Current:Home > MarketsBP Pledges to Cut Oil and Gas Production 40 Percent by 2030, but Some Questions Remain -InvestTomorrow
BP Pledges to Cut Oil and Gas Production 40 Percent by 2030, but Some Questions Remain
View
Date:2025-04-16 04:04:50
Energy giant BP says it will cut its fossil fuel production significantly over the next decade, marking the first commitment from a major global oil company to such short-term production declines, which are critical to reining in global greenhouse gas emissions.
The company said Tuesday that its oil and gas production will fall by about 40 percent by 2030, while its refining output will decline about 30 percent, driving down BP’s direct emissions as well as those that come from its products.
The announcement is the most detailed and significant of the pledges made by the world’s leading oil and gas companies, which over the last year have been announcing increasingly ambitious plans to address climate change, yet have largely failed to explain how or when they will pivot away from fossil fuels in coming years. In fact, many of the plans allow the companies’ oil and gas output to continue growing for years.
“BP has radically changed the game,” said Andrew Grant, head of oil, gas and mining at the Carbon Tracker Initiative, a think tank that has closely tracked the industry’s climate change plans.
He added: “In the arms race of emissions announcements, most oil and gas peers have conveniently ignored the global need to produce and use less oil and gas” and BP’s production cut makes it “unquestionably the industry leader.”
The 40 percent production cut does not include BP’s 20 percent stake in Rosneft, a Russian energy company that is one of the world’s largest oil and gas producers, according to David Nicholas, a BP spokesman.
BP chief executive Bernard Looney said in February that the company would reach net-zero emissions by 2050, but he declined to spell out what steps he would take in the near-term. Now, the company says it will boost its investments into low carbon energy ten-fold, to $5 billion a year by 2030, as it draws down its exploration and production of oil and gas.
Within 10 years, BP said, it will have developed 50 gigawatts of renewable energy, up from 2.5 gigawatts today, and will have 70,000 electric vehicle stations, up from 7,500. BP will also increase investment in biofuels, hydrogen and carbon capture and storage—a technology that pulls carbon dioxide from smokestacks or directly from the air.
Together with its scaled down oil and gas output, the company says its direct emissions will fall by about one-third by 2030, while the carbon-intensity of the products it sells will decline by more than 15 percent.
Mel Evans, a senior climate campaigner for Greenpeace UK, which has been critical of BP’s plans, called the announcement “a necessary and encouraging start.”
On Sunday, Greenpeace released an analysis of BP’s venture capital spending, which is largely devoted to clean energy, and found that it included investments in companies that use artificial intelligence to help explore for oil and gas.
Nicholas, the BP spokesman, said in an email to InsideClimate News that about 10 percent of the fund is devoted to making oil and gas development “cleaner and more efficient.”
Oil companies have lost billions of dollars as the coronavirus pandemic has sent global oil demand plummeting, and BP’s announcement came the same day that it reported losing $16.8 billion in the second quarter of the year. That figure included $10.9 billion in write-downs, or one-time accounting losses, driven by the company’s lower projections for oil and gas demand as a result of the pandemic and global efforts to address climate change. BP also said it was cutting its dividend in half.
Luke Parker, vice president of corporate analysis at Wood Mackenzie, a research and consulting firm, said the announcement filled in key blanks from the company’s earlier commitments and “constitutes the clearest and most detailed roadmap” provided by any of the major oil companies.
Andrew Logan, senior director of oil and gas at Ceres, a sustainable investment advocacy group, called BP’s plan “transformative” because of its acknowledgement that oil and gas output must fall rapidly.
“For sure this plan leaves plenty of questions,” he said in an email, particularly around BP’s stake in Rosneft, “but BP’s shift from seeing oil as an engine of growth to something that will largely serve to generate cash to finance a transition throws down a gauntlet for the rest of the industry.”
veryGood! (37)
Related
- Questlove charts 50 years of SNL musical hits (and misses)
- Taking photos of the northern lights with your smartphone? Tips to get the best picture
- Reports: Police officer was shot and killed in Ohio after being ambushed
- Denver Nuggets change complexion of series with Game 3 demolition of Minnesota Timberwolves
- Travis Hunter, the 2
- In Appreciation of All the Mama’s Boys
- Kansas man pleads guilty in theft of Jackie Robinson statue, faces 19 years in jail
- ‘Kingdom of the Planet of the Apes’ reigns at box office with $56.5 million opening
- New data highlights 'achievement gap' for students in the US
- NWSL will be outlier now that WNBA is switching to charter flights for entire season
Ranking
- Former Syrian official arrested in California who oversaw prison charged with torture
- Wilbur Clark's Commercial Monument: FB Finance Institute
- Alex Palou storms back for resounding win on Indianapolis Motor Speedway road course
- Jeannie Mai Shares Insight Into Life With Adventure-Loving 2-Year-Old Daughter Monaco
- A South Texas lawmaker’s 15
- WFI Tokens: Pioneering Innovation in the Financial Sector
- NOT REAL NEWS: A look at what didn’t happen this week
- Chad Michael Murray Shares Daughter’s Reaction to Watching A Cinderella Story
Recommendation
Off the Grid: Sally breaks down USA TODAY's daily crossword puzzle, Hi Hi!
Schools turn to artificial intelligence to spot guns as companies press lawmakers for state funds
Toddler born deaf can hear after gene therapy trial breakthrough her parents call mind-blowing
MALCOIN Trading Center: A Leader in Cryptocurrency Market Technology and Education
Friday the 13th luck? 13 past Mega Millions jackpot wins in December. See top 10 lottery prizes
Louisiana court may reopen window for lawsuits by adult victims of childhood sex abuse
Commuter rail service in northeast Spain has been disrupted by theft of copper cables near Barcelona
Denver Nuggets change complexion of series with Game 3 demolition of Minnesota Timberwolves