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BP commits to Gulf of Mexico as $9bn platform comes online

BP has began pumping crude by way of a brand new $9bn offshore platform within the oil-rich US Gulf of Mexico because it slows its transition out of fossil fuels amid rising vitality safety fears.

The corporate stated on Thursday that it had began producing oil by way of the Argos deepwater platform, its largest new undertaking within the area in additional than a decade, which is able to pumping 140,000 barrels a day of oil and fuel from fields beneath 1000’s of toes of water.

Bernard Looney, BP’s chief government, stated bringing Argos on-line confirmed that the corporate was “investing in right now’s vitality system”. It could strengthen the corporate’s place within the Gulf of Mexico, the place it’s the largest producer, “for years to come back”, he added.

The sphere’s start-up comes at a pivotal time for BP after Looney in February scaled again formidable plans to shift the oil supermajor out of fossil fuels.

Looney introduced then that the corporate would trim its oil and fuel output by 25 per cent by 2030, in contrast with a earlier goal of 40 per cent, saying that governments needed BP to proceed investing in fossil fuels. Traders had additionally questioned the earlier technique, arguing {that a} shift into renewable vitality would diminish returns.

US president Joe Biden has leaned on the home oil and fuel business to extend oil output after gasoline costs spiked to file highs final yr when Russia’s full-scale invasion of Ukraine sparked fears that international oil provide would fail to maintain up with rising demand.

Starlee Sykes, head of BP Gulf of Mexico enterprise, advised the Monetary Occasions in an interview that the corporate had responded to Biden’s name and deliberate to proceed exploration for brand spanking new oil and gasfields within the Gulf of Mexico.

The Argos platform will increase its manufacturing capability within the area to 400,000 b/d, about 20 per cent of the corporate’s complete output.

“The Gulf of Mexico has among the greatest barrels we’ve received and we wish to discover and develop extra,” Sykes stated.

BP additionally sees the potential to proceed increasing output within the area for many years to come back, she added, regardless of a objective of reaching web zero emissions by 2050.

“It’s massively prolific . . . there’s nonetheless a protracted, lengthy option to go within the Gulf,” stated Skyes.

The brand new Argos platform is the primary new platform the corporate has deployed within the area because the Deepwater Horizon explosion in April 2010 that killed 11 individuals and unleashed the worst offshore environmental catastrophe in US historical past.

It comes amid heightened considerations that shortfalls in international oil provides may result in a recent spike in crude costs later this yr, a risk to a world financial system reeling from excessive inflation.

Such fears have been exacerbated when the Opec+ group of producers stated earlier this month that it could reduce greater than 1mn b/d of output.