(Alliance News) - BP' PLC's new Chief Executive Murray Auchincloss has imposed a hiring freeze and paused new offshore wind projects, Reuters reported, citing sources at the company.

The moves are part of a decision by Auchincloss to slow down investments in big budget, low-carbon projects, particularly in offshore wind, that are not expected to generate cash for years, said several sources at BP who declined to be named.

They mark a stark reversal from the direction the CEO's predecessor Bernard Looney took to rapidly move away from fossil fuels, Reuters noted.

This has weighed on BP's shares as returns from renewables shrank, while profits from oil and gas soared in the wake of the Covid-19 pandemic and Russia's invasion of Ukraine.

https://www.reuters.com/business/energy/bp-halts-hiring-slows-renewables-roll-out-win-over-investors-2024-06-27/

BP has reassigned dozens of people tasked with identifying new renewables opportunities to projects already underway such as offshore wind in Britain and Germany, three sources said.

Auchincloss and Chief Financial Officer Kate Thomson have prioritised investing in and even acquiring new oil and gas assets, particularly in the Gulf of Mexico and in the US onshore shale basins, where BP already has large operations, company sources briefed on the matter said.

BP will also consider investing in biofuels and some low-carbon businesses that can generate returns in the short term.

Earlier this week, BP agreed to buy Bunge's 50% stake in Brazilian sugar and ethanol joint venture BP Bunge Bioenergia for USD1.4 billion.

BP is also expected to make some job cuts in renewables although no specific targets have been given, Reuters said, adding that BP has imposed a company-wide hiring freeze, with only a few exceptions including frontline and safety personnel.

In May, Auchincloss announced a USD2 billion cost saving drive by the end of 2026 relative to 2023. He also cut his executive leadership team from 11 to 10 members.

Shares in BP rose 0.8% to 476.40 pence in London on Friday morning.

By Jeremy Cutler, Alliance News reporter

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