BP will sell its U.S. onshore wind business to New York-based LS Power, as the Big Oil giant continues to divest from much of its renewable energy assets amid financial challenges.
The anticipated sale, announced July 18 for an undisclosed sum, meshes with BP’s new strategy of doubling down on fossil fuel production while cutting overall costs, especially in clean energy investments. It includes ownership stakes in 10 U.S. wind farms with a combined gross capacity of 1.7 gigawatts, roughly enough to power 1.3 million homes.
“We have been clear that while low-carbon energy has a role to play in a simpler, more focused BP, we will continue to rationalize and optimize our portfolio to generate value,” said William Lin, BP executive vice president for gas and low-carbon energy, in a statement. “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.”
Amid struggling stock performance and increased investor activism, BP announced in February it would divest about $20 billion in assets through 2027, including up to $4 billion in 2025. The company said it would also be investing nearly 20% more per year in oil and gas production.
Earlier this month, BP said it would sell its network of 300 fueling stations in the Netherlands—also for an undisclosed price—to the Dutch business Catom. The company plans to sell its retail fueling business in Austria as well, and is also divesting a 50% stake in its Lightsource solar business and selling much of its global offshore wind business through a new, fifty-fifty joint venture with Japanese utility JERA.
BP has already sold a $1 billion stake in the TANAP gas pipeline from the Caspian Sea to Apollo Global Management. A strategic review of its Castrol lubricants business is ongoing. Castrol alone is worth close to $8 billion, according to analyst estimates.
With BP and archrival Shell both now London based, long-rumored reports escalated in late June that Shell would enter early talks to buy BP in what would be the biggest energy deal this century—if not ever. However, Shell quickly denied any such negotiations, and BP has declined to comment.
BP appointed former Shell CFO Simon Henry to its board in July—three months after longtime BP chair Helge Lund said he planned to step down.
The renewable energy business in the U.S. is facing additional headwinds from the Trump administration’s opposition to wind and solar power, including the recent rapid phasing out of tax credits for clean energy construction through the president’s new mega-spending legislation.
But BP’s loss is LS Power’s gain. The New York renewable energy developer touted the addition of the wind farms to its 21-gigawatt portfolio of power on Friday as a major coup for the company.
“LS Power’s mission is to solve complex energy problems to improve the world and make lives better by developing a cleaner, more reliable, and affordable energy ecosystem, and today’s announcement represents a material investment in reaching that goal,” said LS CEO Paul Segal in a statement.
The deal, which is expected to close by the end of 2025, includes wind farms in Colorado, Hawaii, Idaho, Indiana, Kansas, Pennsylvania, and South Dakota. The biggest footprints are in Indiana and Kansas.
LS will operate the BP assets under its Clearlight Energy portfolio company.
This story was originally featured on Fortune.com
