BP (NYSE:BP) shares rose Monday following the announcement of a major oil and gas find offshore Brazil, the company’s biggest in 25 years. The discovery was made in the Santos basin, a deepwater pre-salt region recognized as one of the world’s most promising hydrocarbon hotspots.
This marks BP’s tenth discovery of the year, building on earlier finds in Trinidad, Egypt, and elsewhere. The company is targeting production growth to between 2.3 million and 2.5 million barrels of oil equivalent per day by the end of the decade.
Production in 2024 reached 2.4 million barrels per day, although BP expects a slight decline next year.
BP shares were trading 1.6% higher in London at 09:47 GMT.
Preliminary analysis from the drilling site indicated elevated carbon dioxide levels, with additional laboratory tests planned to better assess the potential of the block. BP plans to establish a key production hub in the region, emphasizing its renewed focus on fossil fuels.
The discovery announcement comes ahead of BP’s Q2 earnings report scheduled for Tuesday.
Separately, the Financial Times reported on Monday that BP will likely reveal more details about its $5 billion cost-cutting initiative in the upcoming earnings call, amid increasing pressure from activist investor Elliott Management to accelerate expense reductions.
Elliott is urging CEO Murray Auchincloss to intensify efficiency measures by adding an extra $5 billion in savings to the existing $4 billion–$5 billion target set for 2027, according to the FT. These figures are based on 2023 spending levels.
The hedge fund has “identified tens of thousands of BP support staff globally” as part of the company’s cost base, the report said.
So far, BP has cut $750 million this year and plans to reach its full target through job cuts, asset sales, and streamlining supply chains, the FT added.
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