BP has reportedly decided to sell several oil and gas assets and use the proceeds to increase its investment in renewable energy.
According to a Reuters report, the company intends to advance with the divestment even if crude prices recover.
Sources told the news agency that the strategy was discussed in a BP executives meeting last month when the British oil and gas firm decreased the oil price forecast to $55 a barrel.
Then, the company also announced to book a series of non-cash write-downs and charges of up to $17.5bn (£14bn) due to the impact of Covid-19 crisis.
As part of the new strategy, BP seeks to reduce its oil and gas production by 1Mbpd, or 40%, by the end of 2030.
Last week, BP CEO Bernard Looney was quoted by the Reuters as saying: “As we look at the outlook for BP over the next few years and as we see production declining by 40% it is clear we no longer need exploration to fund new growth.
“We will not enter new countries to explore.”
In the same time period, it aims to increase investment in low carbon energy sources to nearly $5bn annually.
However, the company plan to continue exploration campaigns near existing infrastructure, a move that will require less investment.
Notably, BP has increased the target for returns from asset sales to $25bn in the next five years. Around $12bn of assets have already been identified and are in the divestment pipeline.
Several European oil and gas companies have increased their investments in renewable energy in the recent years after the governments ramped up sustainability efforts and asked the companies to reduce emissions.