BP has today taken a majority stake in carbon offset firm Finite Carbon as it continues with plans to transition to a low-emission business model.
The oil giant is one of several commodities firms buying into the carbon offset sector, banking on the rising price of emissions credits to offset falling oil prices.
Finite Carbon, which is based in California, pays landowners to manage forests which can catch emissions. The company then sells credits to polluting companies.
It currently manages 50 projects in the US, spread across 3m acres.
According to chief executive Sean Carney, the firm is expecting to $1bn for landowners over the next decade, and will take a 20 to 40 per cent cut of the profits.
BP did not disclose the size of its stake, or how much it paid for the acquisition. It put an initial $5m into Finite last year.
In the spring, BP said that it would become one of the world’s biggest producers of renewable energy as part of plans that will see it reduce oil output by 40 per cent over the next decade.
The pledges, which are part of its aim of becoming a net zero emissions firm by 2050, will also see BP invest ten times as much in low carbon energy, increasing expenditure from $500m to $5bn.
It will also build as much renewable energy capacity – 50 gigawatts – in 10 years than currently exists in the UK.
Since announcing the vaunting ambitions, BP has made its first steps into wind power through a deal with Equinor, and also launched a hydrogen partnership with renewables giant Orsted.
The turnaround plan comes at the end of a year in which the firm has cut 10,000 jobs as a result of the coronavirus pandemic, which precipitated a historic plunge in oil prices.