Oil giant BP enters offshore wind JV despite ‘reset’

The newly formed JERA Nex BP has been officially launched just six months after BP announced it was slashing its renewables interests and prioritising on ‘high-return assets’.

Plans for the JV were announced in December, but then three months later BP announced a ‘reset’ and move away from the renewables sector, with CEO Murray Auchincloss saying its transition away from fossil fuels had been ‘too far too fast’, and that it faith in green energy had been ‘misplaced’.

“Our optimism in 2020 for a fast energy transition was misplaced and we went too far, too fast in our plans,” Auchincloss said in March this year. ”We have now fundamentally reset our strategy. We are reducing and reallocating spending to our highest-returning businesses to drive growth. And we are relentlessly pursuing performance improvements and cost efficiency. 

“We are moving fast to grow oil and gas production from some of our most profitable assets in the most critical markets. In the US, we’re ahead of target in our onshore business and well on schedule with a new high-margin oilfield in the Gulf of America. We’re also moving ahead in Iraq to boost production from one of the world’s giant oilfields and recently announced two new gas discoveries in Egypt.

“Far less of our investment will now go into building new low-carbon energy assets.”

Foot in both camps

However, Auchincloss also said that the company would share ownership of wind and solar businesses – and the JERA Nex BP joint venture appears to confirm that strategy, with a foot in both camps.

”The launch of JERA Nex bp shows bp executing our strategy as we outlined at our Capital Markets Update in February – growing low-carbon energy with discipline whilst being capital light,” a spokesperson told Maritime Journal.

JERA is a joint venture of two of Japan’s biggest energy companies, Tokyo Electric Power Company (TEPCO) and Chubu Electric Power. It claims a portfolio of operating assets and development projects with a net potential generation capacity of 13GW, 1GW of which is already installed, 7.5GW in the ‘development pipeline’ and 4.5GW has secured leases.

“JERA Nex BP begins life with a strong operating portfolio and an extensive development pipeline,” said Nathalie Oosterlinck, CEO of JERA Nex BP. “We bring together two highly capable teams with the experience, relationships, purchasing power and unique global access of two of the East and West’s pre-eminent energy companies. This gives us the expertise and experience to find new ways to create value from offshore wind and become one of the world’s leading companies in the sector.”