BP has put its $4 billion U.S. biogas business, Archaea, up for sale as Chief Executive Meg O’Neill accelerates a strategic overhaul of the oil major, which reported its highest quarterly profit since 2022.
The sale marks another step in BP’s shift away from some of its renewable energy investments as the company focuses on improving returns, reducing debt and strengthening its balance sheet, Financial Times reported.
Archaea, the largest renewable natural gas producer in the United States, captures methane emissions from landfill sites. BP acquired the business as part of its strategy to expand into low-carbon energy, but the investment has underperformed. The company wrote down the value of its biogas and solar businesses by $4.2 billion last year and recorded an additional $1.1 billion impairment on its renewable energy assets in the second quarter.
Speaking after the results, O’Neill said some of BP’s investments had failed to generate the expected returns, prompting a review of the company’s portfolio.
BP reported adjusted profit of $5.7 billion for the second quarter, up 144 per cent from a year earlier and above analysts’ expectations of $5.1 billion. The increase was driven by higher oil, natural gas and refined fuel prices during the conflict between Iran and Israel. It was the company’s strongest quarterly performance since 2022, when energy prices surged following Russia’s invasion of Ukraine.
Since taking charge in April, O’Neill has launched a broad restructuring programme aimed at improving profitability and investor confidence. Recent divestments include BP’s UK North Sea business, its Austrian retail fuel network, its stake in Canada’s Bay du Nord offshore project and the closure of its venture capital arm.
O’Neill said BP had also received unsolicited interest from potential buyers for its North Sea assets and reiterated the importance of continued domestic oil and gas production in the United Kingdom to support the country’s energy security.
The company said its total financial obligations, including debt, hybrid bonds and liabilities related to the Deepwater Horizon oil spill, declined by $7 billion during the quarter. BP expects to reduce its net debt below $18 billion by the end of December, achieving its target a year ahead of schedule.
Separately, Saudi Aramco reported adjusted second-quarter profit of $33.4 billion, up 33 per cent from a year earlier, supported by stronger crude oil and refined fuel prices.
