BP to Exit North Sea After Six Decades of Production
The oil major is divesting its North Sea business as part of a portfolio streamlining effort.
BP is exiting the North Sea, putting its business operations up for sale after 60 years of production in the basin. The decision is part of the company's strategy to streamline its portfolio and focus on its highest-value opportunities, according to Chief Executive Meg O’Neill.
“The North Sea remains integral to the UK's energy system,” O’Neill stated. “However, as we focus our portfolio and direct capital to our highest-value opportunities, we believe our North Sea business will be better positioned as part of another company.”
Earlier this year, BP engaged in talks with Ithaca Energy regarding a potential £2 billion deal for the North Sea business, which employs approximately 1,100 people. However, no agreement was reached.
BP operates five key production hubs in the North Sea, including the Clair oilfield, which is the largest on the UK continental shelf. The company's planned exit from the region aligns with its ongoing efforts to slim down the group by divesting certain assets. O’Neill, who assumed leadership in April, is spearheading a reorganization of BP’s operations and a renewed focus on fossil fuels.
BP’s planned withdrawal from the North Sea comes amid a broader discussion on energy policy in the region. The Prime Minister has indicated a “pragmatic” approach to drilling, following a call with President Donald Trump. This approach has led to calls to approve licenses for the Rosebank oil field and Jackdaw gas field, with decisions potentially expected next month.
Despite the sale of its North Sea business, BP affirmed that its headquarters will remain in the UK. “The UK has been our home for more than 100 years and will continue to play an important role in our future,” O’Neill added.
In a separate development on Thursday, reports indicated that BP was preparing to cut 700 jobs within its upstream division, which is responsible for the discovery and extraction of crude oil. These cuts are not expected to affect front-line roles such as technicians.
The company aims to streamline its operations and enhance returns amidst signs of potential oversupply and declining oil and gas prices.