(Oil Price) – BP is looking to raise the number of its board members and hire two more directors as part of its strategy to boost oil and gas production and shareholder returns, the Financial Times reported on Tuesday, citing sources familiar with the plans.
Last week, BP said that it is increasing its investment in upstream oil and gas to $10 billion per year while slashing spending on clean energy by more than $5 billion a year in the highly anticipated strategy reset.
BP’s chair Helge Lund now looks to respond to investor pressure, especially from activist investor Elliott Management, to strengthen the board.
The UK-based supermajor is considering raising the number of board members to 13 from 11. One of the new directors would be in charge of oil and gas while the other will head the company’s remuneration committee, according to FT’s sources with knowledge of the internal discussions.
It wasn’t immediately clear whether BP has consulted on possible new hires with Elliott Management, which has demanded changes in strategy or even board reshuffles. It’s not clear how far ahead BP is in a recruitment process in the search for two more directors, FT notes.
BP’s reset announced last week will see the supermajor reallocating capital expenditure to higher-growth businesses. This means increasing oil and gas investment to about $10 billion per year and slashing transition investment to around $1.5 billion–$2 billion a year, which is over $5 billion per year lower than the previous guidance.
In the upstream, BP will aim for 10 new major projects to start up by the end of 2027, and a further 8–10 projects by the end of 2030. Production is also expected to grow, to 2.3–2.5 million barrels of oil equivalent per day (boed) in 2030, with capacity to increase to 2035.
That’s a stark departure from the previous strategy to lower oil and gas output by 2030.
By Tsvetana Paraskova for Oilprice.com
