BP exits Australian green hydrogen project to refocus on oil and gas

Energy major’s pivot underscores broader industry shift away from renewables amid investor pressure.

BP has announced its decision to withdraw from one of the world’s largest renewable energy ventures, the Australian Renewable Energy Hub (AREH), signaling a renewed emphasis on fossil fuels amid ongoing investor scrutiny.

The British energy giant informed its partners that it will step down as both operator and equity stakeholder in the project, according to Reuters. This marks a significant reversal in BP’s renewable energy ambitions, especially as the company had previously held a 63.57% stake in AREH.

The AREH project, located in Western Australia’s Pilbara region, is designed to harness up to 26 gigawatts (GW) of solar and wind capacity to produce approximately 1.6 million tonnes of green hydrogen annually. It is backed by private companies InterContinental Energy and CWP Global, in addition to BP.

BP’s exit comes as part of a broader strategic shift to scale back investments in renewables in favor of more traditional oil and gas operations. In recent quarters, the company has faced criticism from investors concerned about underwhelming returns in its low-carbon ventures.

This move follows the announcement of Albert Manifold being appointed as new chair of the company, succeeding Helge Lund. Under new leadership, BP has scaled back its 2030 emissions reduction target and re-emphasized the profitability of its core oil and gas operations.