BP has reduced its oil exploration to 100 members, down from 700, as it focuses on renewable energy.
With climate change headlining the agendas of many countries, companies around the globe are taking drastic action to adapt and prepare for an economy based on renewable energy. Nowhere is that transformation more drastic than the very industry that has provided the fossil fuels the world has depended on.
BP is among those energy companies leading the charge, thanks to CEO Bernard Looney. Under Looney, the company has been aggressively pivoting to renewable energy and scaling back its oil exploration efforts, according to Reuters. The company is using its existing petroleum business to help fund the transition.
“We are in a harvest mode and what isn’t being said is that BP is going to be a much smaller company without exploration,” a source in BP’s oil and production division said told Reuters.
The company has been hiring staff from Silicon Valley, Toyota, Uber and more in an effort to better understand electric vehicles and other key parts of the renewable energy industry in an effort to help it better compete.
Looney’s efforts are not without risk, however, as some worry the company may prematurely slash its oil income before its investments in renewable energy pay off.
“There is so much internal change that it will be a big job to pick up the organisation and get things going,” a senior employee in the exploration division told Reuters.
There’s no doubt the company is experiencing challenges with its transformation, with the stock at its lowest point in 25 years. Looney is adamant, however, that BP must change in order to remain relevant.
“Everywhere I have been, inside BP as well as outside BP, I have come away with one inescapable conclusion, and that is that we have got to change,” he said in a webcast.
If Looney can pull off his vision, BP will be far better positioned than competitors who are trying to hang on to a dying industry as long as possible.
