BP has struck a deal to offload its US onshore wind business to LS Power, as the FTSE 100 energy major pushes ahead with its pivot back towards fossil fuels in a bid to revive its share price.
The wind farms, spread across seven states, are all operational and have a combined capacity of 1.7GW, of which BP owns 1.3GW.
The sale is the latest move in a $20 billion (€17 billion) divestment programme, announced by BP in February, to streamline its business and boost returns to shareholders after a period of lacklustre performance.
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The terms of the deal, announced on Friday, were not disclosed. In April, BP said it had signed or completed $1.5 billion of divestments already in 2025 and expected to raise a total of $3 billion to $4 billion from asset sales over the course of the year.
Some previous estimates have valued the BP’s US onshore wind business at as much as $2 billion. However, pricing for recent transactions involving US wind farms of a similar age suggests the value is likely to be lower.
BP said the deal followed a “competitive” 10-month auction process.
[ Shell denies takeover talk, but BP’s woes persistOpens in new window ]
After completion of the transaction, which is expected before the end of the year, BP Wind Energy will form part of LS Power’s subsidiary Clearlight Energy, increasing the North American energy group’s operating fleet to about 4.3GW.
The move comes as BP seeks refocus on its core oil and gas operation.
William Lin, the company’s executive vice-president for gas and low-carbon energy, said on Friday that green energy still “has a role to play” in its portfolio, adding: “The onshore US wind business has great assets and fantastic people, but we have concluded we are no longer the best owners to take it forward.”
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The UK oil major put the wind energy business up for sale last September. At the time, Lin said the onshore wind business was “not aligned” with BP’s plans for growth in Lightsource bp, its solar energy business.
BP is also exploring a sale of its lubricants arm Castrol, which has drawn interest from private equity and industry bidders and could be valued at $8bn, though some parties are considering making lower bids, the Financial Times reported in June.
Over the past 12 months, BP’s share price has fallen more than 10 per cent, sparking speculation that it could be ripe for a takeover. Activist investor Elliott Management has built a stake and been pressuring the board to shake up the business.
Last month, rival Shell was forced to deny rumours that it was planning a bid for BP, saying it had “no intention” of making an offer for the company.
This month, BP warned that lower oil and gas prices were likely to hit second-quarter earnings, despite it increasing production. The company said it expected earnings in its oil business to be $600mn-$800mn lower in the three months to the end of June than the previous quarter, while gas would be between $100mn and $300mn lower.
BP’s shares rose 1.9 per cent in morning trading. – Copyright The Financial Times Limited 2025
