BP shares stayed near 470p on Monday after the company said it will sell its Bay du Nord project. The move means BP will have lower capex commitments in the years ahead.
- BP is selling its 37.2% interest in Bay du Nord to Equinor ASA NYSE:EQNR. Terms of the deal weren’t announced.
- BP traded at 469.55p at 14:58 BST, up around 0.5% from the prior close. The FTSE 100 slipped 0.44%.
- The stake covered around 149 million barrels from the first phase and C$5.21 billion of planned spending, based on published project numbers.
- LSEG/Investors Chronicle puts the median 12-month target at 604.38p. That’s roughly 29% higher than the last price on the forecasts page.
BP PLC LON:BP ticked up in London on Monday after the company said it would exit the Bay du Nord oil project in Canada. The deal eases BP’s future capital spending, but shares barely reacted.
Equinor ASA NYSE:EQNR is taking over full control of Bay du Nord, while BP exits the deepwater project. The venture is expected to require about C$14 billion for its first phase and target first oil in 2031. Philippe Mathieu, who oversees exploration and production international for Equinor, said work on the business case and project risks has made the asset stronger.
For investors, the takeaway is pretty direct. BP’s 37.2% interest covered over 148 million barrels of initial recoverable oil and about C$5.21 billion, or $3.66 billion, in projected development costs. BP didn’t say what it got for its stake, so the cash benefit isn’t clear. But investors can count the avoided capex.
| Bay du Nord measure | Project forecast | BP’s former 37.2% read-through |
|---|---|---|
| Initial-phase recoverable resource | Over 400 mln barrels | Over 148.8 mln barrels |
| Expected initial investment | Roughly C$14 bln / $9.84 bln | Roughly C$5.21 bln / $3.66 bln |
| Final investment decision | Early 2027 | BP doesn’t need to fund if the sale closes |
| First oil | Targeting 2031 | BP won’t take production if deal goes through |
BP is still under the microscope on its debt load and shareholder payouts. In February, the company paused buybacks, moving cash toward cutting debt and higher-return oil and gas plays. Back then, net debt was $22 billion, with BP sticking to its 2027 debt target of $14 billion-$18 billion. CFO Kate Thomson said the company could bring back buybacks “when it meets its debt-reduction target.” Reuters
BP got little help from oil. Brent slipped 0.65% to $71.65 a barrel at 1227 GMT as OPEC+ signed off on a 188,000 barrel per day increase in output targets starting in August and Gulf shipments picked back up. PVM’s Tamas Varga said producers were “selling into a falling market.” Reuters
The curve slipped again last week. Brent for prompt delivery moved under contracts stretching out six months, something that hasn’t happened this year, pointing to looser supply now. “The front of the curve is taking the hit,” said David Jorbenaze, ICIS oil markets lead. Reuters
BP’s trading arm gave it a boost that pure upstream names lack. Q1 profit hit $3.2 billion, up more than twofold, after oil trading pushed customers and products pre-tax profit to $3.2 billion—the best since 2022. CEO Meg O’Neill told Reuters that BP was “controlling what we can control” as disruption in Hormuz hit some flows. Reuters
Forecasts for the share price are spread out. The median target suggests a big climb from the last London close, though the lowest target is under the current market level.
| BP forecast item | Bear case | Median case | Bull case |
|---|---|---|---|
| 12-month target price | 429.88p | 604.38p | 699.49p |
| Implied move vs 469.55p | -8.5% | +28.7% | +49.0% |
| Analyst count in target set | 19 analysts | 19 analysts | 19 analysts |
As of July 2, Investors Chronicle’s LSEG feed showed analysts had four buy, nine outperform, 10 hold, and two sell ratings on BP. The feed puts BP’s next earnings report on Aug. 4. That will give the first full quarter showing O’Neill’s moves on debt and the portfolio.
