bp puts North Sea oil and gas business up for sale

AFTER six decades of operation, bp has made the historic move to sell its oil and gas business in the UK – giving up all production assets in its home country.

The decision comes amid political division in the UK over North Sea drilling, with energy companies making a case for domestic security in the face of environmental concerns.

The new Prime Minister Andy Burnham is seen to be more favourable toward further drilling, taking a more “pragmatic approach” to energy policy.

Despite this outlook for energy companies, bp and others have been deterred in the region over the past few years because of the UK’s controversial windfall tax, which according to the last budget will remain set until 2030.

bp restructure

The sale is part of a string of bp’s offloading plans that have made up its large-scale restructure in recent years, which has also included rapid changes in leadership.

Meg O’Neill, the CEO of bp, who replaced Murray Auchincloss in April of this year, has spearheaded a downsizing in the company, including the sale of its lubricant business Castrol at the end of the year. Auchinloss himself replaced Bernard Looney less than two years before.

The company also announced that it would cut 700 “non-frontline jobs”, according to an internal email, reports the FT. The email indicated that the decision was down to a “potential oversupply and lower oil and gas prices”, bringing the company’s competitiveness down. bp already cut around 7,000 jobs last year.