Activist Investor Doubles Down on Calls for Executive Changes at BP — Update

By Dominic Chopping

U.K. activist investor Bluebell Capital Partners is doubling down on its call for BP to remove its chairman and lead independent director, while urging the company to comment on a media report that detailed a further change in the oil company's strategy.

Reuters reported last week that BP abandoned a target to cut oil-and-gas output by 2030, with Chief Executive Murray Auchincloss reining in the firm's energy transition targets to regain investor confidence.

BP said it doesn't comment on speculation.

Under previous CEO Bernard Looney, the company launched a high-profile push into renewable energy, outlining an ambitious plan in 2020 to cut oil-and-gas output by 40% within 10 years. But following disappointing returns from some of BP's renewable investments, the company said last year that it would slow its shift to lower-carbon energy, targeting a 25% reduction by 2030.

The London-based company also backtracked on U.S. offshore wind plans, which resulted in hefty impairments. Bluebell questioned the company's solar expansion plans while criticizing recent earnings downgrades.

"Not only is the current strategy not delivering its financial targets, but BP is also demonstrably significantly lagging the operational performance of its peers," Bluebell said last month.

While initially well received by proponents of lower-carbon energy investment, the strategy came under pressure after the pandemic, when economies emerged from lockdowns and resumed their insatiable appetite for fossil fuels.

In defending its strategy earlier this year, BP said it was confident it will deliver on its pledge to transform from an integrated oil company to an integrated energy company.

Auchincloss was appointed in January, replacing Looney, who resigned after admitting he hadn't been up front about past relationships with colleagues. The new CEO has failed to stem share-price declines, with the company struggling to match U.S. peers that have been rewarded for sticking with traditional fossil-fuel businesses.

Since Looney's exit a little over a year ago, BP's shares are down some 22%. They are down 9% since Auchincloss took over. That compares to a 27% rise in Exxon Mobil and 6% gain at Chevron.

In a letter sent to both the BP board and the U.K.'s Financial Conduct Authority, Bluebell said that while news of the removal of oil-and-gas production targets is welcome, it constitutes key price-sensitive information that should have been announced through the proper channels.

Bluebell partners Giuseppe Bivona and Marco Taricco said in a letter that this could potentially be a breach of listing rules, demanding that BP immediately issue a press release confirming or denying the Reuters report.

The shareholder added that given the reported U-turns in strategy, BP should update the market with a revised strategic plan, rather than wait for its scheduled strategy update in February.

A BP spokesperson said the company fully complies with its legal and regulatory obligations.

"As Murray said at the start of this year in our fourth-quarter results, the direction is the same — but we are going to deliver as a simpler, more focused, and higher value company," the spokesperson said.

In the letter, Bluebell reiterated its previous call for BP Chairman Helge Lund and lead independent director Amanda Blanc to be removed. Bluebell said it is holding Lund responsible for the company's management while saying Blanc refused to make herself available to address its concerns.

BP rebuffed the claims, saying Bluebell's views weren't shared by investors.

"The re-election of Helge and Amanda was overwhelmingly supported by shareholders with well over 95% of votes cast in their favor at the AGM. We hear no support for Bluebell's position," the spokesperson said.

Bluebell declined to disclose the size of its shareholding in BP, but according to LSEG Refinitiv data the holding is below 0.49%.

Write to Dominic Chopping at dominic.chopping@wsj.com