CORRECTION | 02.04.10: Over the past three years BP cut costs by $4 billion in cash at corporate level. The 7,500 job cuts impacted all of BP’s business units, not just BP Alternative Energy, as we inaccurately reported.
Update: We have been listening to a replay of?the BP fourth quarter earnings call. Chief Executive Hayward said that when it comes to BP’s renewable business?the focus is on biofuel development; continued development of its U.S. wind power portfolio; lowering production cost at its solar panel business; and investments in a carbon storage project in the United Arab Emirates.
Hayward’s comments are inline with BP actions over the past year.
Last march BP confirmed plans it would invest in two sugar-based ethanol refineries in Brazil.
Through 2009 the company also significantly scaled down its solar business,? closing manufacturing plants in Maryland and Spain. In 2008 the company shutdown a PV manufacturing plant in Australia.
In terms of wind power this year BP?s 400-megawatt Fowler Ridge wind farm, in northern Indiana, became fully operational.? Confirming its preference for the U.S. wind market, late last year BP sold two wind farms in India to Bombay private equity IDFC Private Equity.
Finally, at the end of last year BP acquired a 50 percent stake in a carbon capture and storage (CCS) project in Dubai from Rio Tinto.
We expect to have more details on BP’s investments in its renewable energy business when it announces its 2010 capital expenditure plan on March 2.
BP, Europe’s largest oil and gas company, posted a fourth-quarter profit of $4.3 billion after losing $3.34 billion in the prior-year period when oil prices had plummeted. For the year, BP earned $16.58 billion, down 22 percent from 2008 levels.
When it comes to renewable energy BP is continuing to cut costs at a unit that until Tony Hayward’s 2007 appointments as CEO, acted as the cornerstone of the company’s “Beyond Petroleum” strategy.
BP cut costs at corporate level its renewable energy unit by $4 billion. Staffing over the past three years has also shrunk by 7,500. Specifically, it cut senior management positions from 650 to fewer 500 over the past year. One of the high profile departures was this summer’s resignation of Vivienne Cox, chief executive of BP’s alternative energy unit.
– More to come, we will be dialing in on the conference call.