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BP‘s new chief executive, Tony Hayward, announced a major business restructuring this week that could result in the company’s clean energy initiatives getting pushed to the back burner. Calling it “a fundamental shift” in the way the oil giant does business, Hayward said BP’s gas power […]

bp.jpgBP‘s new chief executive, Tony Hayward, announced a major business restructuring this week that could result in the company’s clean energy initiatives getting pushed to the back burner. Calling it “a fundamental shift” in the way the oil giant does business, Hayward said BP’s gas power & renewables division would be folded into its two existing exploration and refining segments.

BP has long touted itself as a green innovator, and under the previous chairman, Lord Browne of Madingley (you guys remember why he stepped down, right?), was having some success with it — cutting carbon emissions, investing in wind and solar, and pushing the slogan “Beyond Petroleum.” BP still plans to invest $8 billion dollars over the next 10 years in clean energy technologies. But, as The Times of London business editor James Harding wrote of the restructuring: “for… the climate change lobby, who have long seen BP not just as a big oil company, but a good one, this is a brutal reality check.”

The restructuring looks like red meat for investors. Hayward seems intent on inspiring investor confidence that he will increase profit margins for the company, as BP’s stock price has begun to lag its largest competitors, like Exxon Mobil (XOM). Over the last year, Exxon’s stock is up 168 percent while BP shares have risen 79 percent; Exxon is trading at a price-to-earnings multiple of 13.26 while BP sits at 8.99.

Of course BP, while it has invested more heavily in alternative energy than other oil companies, never stopped pumping oil — it extracts 3.8 million barrels a day.

  1. [...] Written by Katie Fehrenbacher No Comments Posted October 23rd, 2007 at 4:39 pm in Big Green While BP is renewing its focus on non-renewable resources, the company has posted a 29 percent drop in third-quarter net income, to $4.4 billion from $6.23 [...]

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  2. [...] While BP is renewing its focus on non-renewable resources, the company has posted a 29 percent drop in third-quarter net income, to $4.4 billion from $6.23 billion in the same period last year. Citing problems in its U.S. refineries, oil and gas production in the latest three-month period fell to 3.65 million from 3.8 million barrels per day. [...]

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  3. [...] lackluster effort to reduce the levels of ammonia and toxic sludge particles in its discharge is another step back from the increasingly empty slogan of “Beyond [...]

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  4. [...] the company, which fashions itself as “Beyond Petroleum,” appears to be pulling back from its clean energy perch, [...]

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  5. [...] No Comments Posted December 12th, 2007 at 12:00 am in Big Green First BP quietly demoted its renewables division and decided to invest in dirty tar sands oil production. Now Shell has sold off the majority of its [...]

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  6. [...] BP quietly demoted its renewables division and decided to invest in dirty tar sands oil production. Now Shell has sold off the majority of its [...]

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  7. [...] while BP has made suggestions that it’s been moving away from the company’s renewable energy division, weaker profits could mean an even paler shade of green for BP. Particularly when its oil company [...]

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  8. [...] has said it will invest $8 billion dollars over the next 10 years in clean energy technologies. And it has been making investments in the U.S. [...]

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  9. [...] Yahoo! BuzzDigg Stumble Reddit del.icio.us Email « BP: Going Back to Its Petroleum Roots A Biofuels Video Primer [...]

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