- BP plans to reduce its stakes in the Net Zero Teesside and Northern Endurance Partnership projects.
- The move comes as the company reshapes its low-carbon strategy under new chief executive Meg O’Neill.
- Investors are closely watching whether large-scale carbon capture projects can attract long-term funding.
BP is looking to bring in new investors for two of the UK’s biggest carbon capture and storage projects, marking another step away from the aggressive green expansion strategy championed by former chief executive Bernard Looney.
The company said it plans to sell part of its holdings in the Net Zero Teesside Power project and the Northern Endurance Partnership pipeline and storage network in north-east England. The projects are central to the UK’s industrial decarbonisation plans and form part of the government-backed East Coast Cluster strategy.
BP said the “time is right” to introduce additional partners after the projects reached financial close and entered construction. The company, however, did not reveal how much equity it plans to sell or whether discussions with potential buyers are already under way.
The move comes as BP continues to reassess its low-carbon investments under new chief executive Meg O’Neill, who took over the role in April. Industry observers see the planned stake sales as part of a broader attempt to recycle capital into projects considered commercially safer or faster to scale.
An approach to net zero
The Net Zero Teesside Power project, being developed alongside Equinor, is expected to generate up to 742 megawatts of lower-carbon electricity once operational later this decade. The gas-fired power station is designed to capture around 2 million tonnes of carbon dioxide emissions each year, with a targeted capture rate of roughly 95 per cent.
The captured emissions would then be transported through the Northern Endurance Partnership network, backed by BP, Equinor and TotalEnergies, before being stored beneath the North Sea.
The storage site is centred on the Endurance saline aquifer, located about 145 kilometres offshore from Teesside. Initial capacity is expected to handle around 4 million tonnes of carbon dioxide annually, although developers have spoken about scaling this to as much as 20 million tonnes a year during the 2030s if more industrial sites connect to the network.
Supporters argue the infrastructure could help decarbonise heavy industries across northern England, including chemicals, refining, fertiliser production and steel manufacturing, while also helping stabilise Britain’s electricity grid as renewable energy capacity grows.
Still, carbon capture remains one of the energy sector’s most debated technologies. Critics have repeatedly questioned whether such projects can operate economically over decades without heavy government backing.
Investors watching closely
The stake sale is being viewed as an early test of investor appetite for large-scale carbon management infrastructure. Analysts say pension funds and infrastructure investors may be interested if long-term government support mechanisms reduce the financial risks tied to the projects.
The UK government has introduced industrial carbon contracts and power support agreements aimed at improving commercial viability for carbon capture developments. Whether that support is enough to attract long-term private capital remains unclear.
BP’s latest move also lands during a wider strategic rethink inside the company. Reports have suggested the oil major is reviewing its long-term exposure to the North Sea after more than six decades in the basin.
The company’s leadership overhaul has steadily reversed parts of Looney’s low-carbon agenda, which once positioned BP as one of the more aggressive energy transition players among European oil majors.
Looney had previously described the Teesside carbon capture plans as “the right thing for the world” and “a tremendous business opportunity”, as quoted in a news report.
Meanwhile, political tensions around the UK’s energy sector continue to build. The government has blocked new North Sea exploration licences and kept in place the windfall tax regime introduced during the energy crisis, despite repeated lobbying from oil and gas producers.
Energy secretary Ed Miliband also briefly criticised BP’s recent profits on social media last week before deleting the comments, according to reports.
For now, construction on the Teesside projects continues. But BP’s decision to reduce its exposure suggests even some of the world’s biggest energy companies are still weighing how far — and how fast — they want to go on carbon capture.
