Sources say that BP is considering selling a minority stake in the offshore wind business.

Four sources familiar with the matter have confirmed that BP may sell a minority stake of its offshore wind division. This is the latest move by CEO Murray Auchincloss in his efforts to reduce the company's focus towards renewables.

Shareholders have been putting pressure on the company to abandon its 2020 energy transition strategy as profits from renewables are decreasing and margins for oil and gas are increasing.

Sources, who spoke on condition of anonymity as the process was private, said that the London-listed oil firm has enlisted Bank of America in order to find business partners. Two sources claim that BP is looking to cut its share of these large investments.

A spokesperson from BP declined comment.

One source stated that BP is committed to the development of its major offshore projects. In recent months, the company has invested in solar energy, biofuels, and low-carbon hydrogen.

Auchincloss has pledged to revamp the plans of the company to focus on high-margin business, and distance himself from the predecessor Bernard Looney’s strategy to expand renewables quickly and reduce oil production.

Investors are concerned about BP's ability to maintain profits and payouts to shareholders.

In June, the company reported that it had halted investment in new offshore projects. BP announced last month that it intends to sell its U.S. Onshore Wind business.

The CEO also stated that BP will sell a share of its solar joint venture Lightsource BP when it completes the full acquisition within the next few months. Sources told us earlier this month that he has also scrapped BP’s flagship goal to reduce oil production by 25% from 2019 to 2030.

BP does not currently have any offshore wind farms operating. The offshore business is involved in projects in Britain and Germany as well as the United States, Asia and Australia. At the end of June, there was a pipeline with 9.6 gigawatts of capacity.

BP was awarded the rights last year to build, operate and develop two plants with a 4 GW total capacity in Germany. BP agreed to pay 6.7 billion euro ($7.27 billion), over a period of 20 years, when the plants become operational within the next decade.

In Britain, BP and its partner EnBW are also developing three windfarms with a combined power of 5,9 gigawatts in the Irish Sea or the North Sea.

In recent years, the rapidly growing offshore wind sector has faced a number of challenges. Costs have risen due to problems with supply chains and technical issues. Interest rates also increased. This led to many companies reviewing their investments.

According to the company's statement, BP took a $1.1 billion impairment last year in relation to its U.S. Offshore Wind Projects. Later, it broke up an offshore wind joint venture in the U.S. with Equinor of Norway.

Due to the increasing cost of building wind farms more than 100 km offshore, other companies have also considered their investments or assumed impairments.

Macquarie, which has reported previously, has put its offshore unit Corio up for sale. Orsted, world's largest offshore wind farm developer has also lowered its investment and production targets.

(source: Reuters)