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BP to quit main U.S. refining lobby over carbon policy

Stock MarketsFeb 26, 2020 12:34PM ET
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© Reuters. FILE PHOTO: BP's new Chief Executive Bernard Looney gives a speech in central London

By Ron Bousso

LONDON (Reuters) - BP (L:BP) will leave the main U.S. refining lobby and two other trade groups as new Chief Executive Bernard Looney spurs some of the oil sector's most ambitious targets for curbing carbon emissions.

The decision follows a review of its membership in over 30 associations around the world, which Looney said in a post on Instagram was aimed at boosting people's trust in the oil and gas company.

"BP will pursue opportunities to work with organisations who share our ambitious and progressive approach to the energy transition," Looney said in a statement.

BP said its view on carbon pricing, which it says is key in the energy transition, were "at odds" with those of the American Fuel & Petrochemical Manufacturers (AFPM), which has around 300 members.

"Currently we have no areas of full alignment," BP said.

It will also not renew its membership in the Western States Petroleum Association (WSPA) and Western Energy Alliance (WEA).

"AFPM is and has been committed to supporting policies that address climate change," said AFPM Chief Executive Chet Thompson. "Because of that, it leads us to assume that this decision was made based on factors other than our actual positions on the issues."

Bruce Duguid, head of stewardship at Federated Hermes, which has led talks with BP on shareholder climate resolutions in recent years, welcomed the move.

"Supportive public policy is vital to achieving BP’s bold vision to become a net zero company by 2050 or sooner," Duguid said in a statement.

BP has called for placing a price on carbon emissions in order to push out the most polluting fossil fuel production including coal and encourage investment in renewable energy.

Royal Dutch Shell (L:RDSa) and Total (PA:TOTF) last year both said they would not renew their memberships in the AFPM.

BP, one of the largest U.S. refiners and petrochemical producers and fuel retailers, will a member of the American Petroleum Institute, the country's largest energy association, drawing criticism from climate campaigners.

"The industry’s response to climate change is the key question that will define their performance and viability," Ben Ratner, senior director at Environmental Defense Fund (EDF (PA:EDF)) told Reuters.

BP, Shell and others that in recent years have been investing in cleaner fuel technology have also opposed AFPM's efforts to oppose standards requiring refiners to blend or subsidise the blending of biofuels into the gasoline pool, saying it hurts independent refiners.

The AFPM has around 300 U.S. and international members including Exxon Mobil Corp (NYSE:XOM) and Chevron Corp (NYSE:CVX) which operate 110 refineries and 229 petrochemical plants, its 2018 annual report showed.

Exxon said it routinely evaluates trade group memberships on an annual basis. Chevron did not immediately respond to a request for comment.

BP operates three U.S. refineries including the 430,000 barrels per day Whiting, Indiana plant, its largest.

(Graphic: Oil Majors' Carbon emissions - https://fingfx.thomsonreuters.com/gfx/editorcharts/OIL-CARBON/0H001QX928M7/eikon.png)

BP to quit main U.S. refining lobby over carbon policy
 

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Howl Jenkins Feb 26, 2020 2:17PM ET
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