Says sale process to start shortly
BP said it will launch the sale process shortly for the wind assets, bp Wind Energy, which has interests in 10 operating onshore wind energy assets across seven U.S. states.
“We believe the business is likely to be of greater value for another owner,” William Lin, BP’s executive vice president for gas and low carbon energy said in a statement.
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Several offshore wind companies have cancelled or sought to renegotiate power contracts for planned U.S. projects in the past year, citing soaring materials costs, high interest rates, and supply chain disruptions.
bp Wind Energy’s assets, which have net total generating capacity of 1.3 gigawatts, are not aligned with BP’s plans for growth in Lightsource bp, the London-listed company said.
BP announced in November it would take full ownership of Lightsource bp, Europe’s largest solar energy developer. The deal to build up its renewable energy capacity is expected to be complete by the end of the year.
It said on Monday it would integrate its onshore renewable power development into Lightsource bp.
The move also comes as BP’s new CEO Murray Auchincloss has imposed a hiring freeze and paused new offshore wind projects as he places a renewed emphasis on oil and gas amid investor discontent over its energy transition strategy, sources at the company told Reuters in June.
It marks a stark reversal from the direction the CEO’s predecessor Bernard Looney took to rapidly move away from fossil fuels. This has weighed on BP’s shares as returns from renewables shrank, while profits from oil and gas soared in the wake of the COVID-19 pandemic and Russia’s invasion of Ukraine.
Last month, Danish renewable energy group Orsted (ORSTED.CO), opens new tab reported 3.9 billion Danish crowns ($581.59 million) in impairment losses for the second quarter, partly due to delays in a major U.S. offshore wind project.