One activist investor is taking on supermajor BP. But instead of what all other activist investors have pursued with oil and gas giants in recent years, Bluebell Capital Partners is calling on the UK-based group to renege on its goal to reduce oil and gas production and scale back its ambitions in renewable energy.
Bluebell Capital Partners sent at the end of last year a letter to BP chair Helge Lund, a letter which the Financial Times has seen, urging the supermajor not to reduce its oil and gas output, as it is destroying shareholder value by guiding for moving away from fossil fuels faster than society would need it to.
“This irrational strategy has, quite understandably, depressed the value of BP’s share price,” Bluebell Capital Partners wrote in the letter FT has seen.
After the 2022 energy crisis, BP has the only remaining target among Big Oil to reduce oil and gas production by 2030.
In early 2023, BP scaled back its 2020 target that it would cut its oil and gas production by 40 percent by 2030 through active portfolio management and no exploration in new countries. The new goal is now to reduce production by around 25% compared to 2019, excluding production from Rosneft, compared to the previous expectation of a reduction of around 40%, former CEO Bernard Looney said at the time.
In the autumn of 2023, Looney resigned amid a scandal as he had failed to disclose personal relationships with colleagues at the firm.
The activist investor Bluebell Capital Partners doesn’t want any reduction in oil and gas production at BP and says that the supermajor should stop investing in renewables where it “has no right to win” against companies specialized in the sector.
Asked to comment on the urge from Bluebell Capital Partners, BP told FT that “we have met with most of our major shareholders recently and continue to receive support for our strategy”.
While BP faces investor pressure to abandon renewables, across the Atlantic ExxonMobil is suing two activist investor groups in a Texas district court, aiming to block their climate proposals from going to a vote at the annual shareholder meeting later this year, in the first such direct complaint to court instead of to the SEC.
By Charles Kennedy for Oilprice.com
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