UK-based BP PLC (GB:BP) and its partners have approved a $7 billion gas project in Indonesia, which is expected to discover approximately 3 trillion cubic feet of additional gas reserves. The project will focus on using carbon capture in gas production, marking BP’s first venture of this kind. The project also involves partners such as China’s CNOOC (HK:0883) and Japan’s Nippon Oil Exploration. BP owns a 40% stake in the project and will cover its corresponding share of the $7 billion cost.
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BP is a multinational energy company involved in the exploration, production, and distribution of oil and natural gas.
BP Unveils Carbon Capture Investment
The project is an extension of the Tangguh liquefied natural gas initiative in Papua Barat, Indonesia, which has been supplying LNG to Asian markets like Japan and China since 2009. The new investment in the Tangguh Ubadari, CCUS, Compression (UCC) project will use carbon capture during production to enhance gas recovery, aiming to meet the rising energy demand in Asia.
Under this project, BP will develop the Ubadari field, which will supply gas to the LNG facility. The company stated that production in this field is expected to begin in 2028.
BP Sticks to Fossil Fuels as Renewable Goals Take a Backseat
BP and its peers are returning to fossil fuels as they scale back their renewable goals. The company has shifted its focus to LNG, seeing it as an extension to ease the transition from coal to renewable energy.
Earlier, BP revised its emissions reduction target for fuels, now aiming for a 20% to 30% cut by 2030, down from the original goal of 35% to 40%.
Is BP Stock a Good Buy Now?
According to TipRanks consensus, BP stock has received a Moderate Buy rating based on seven Buys, seven Holds, and one Sell recommendation from analysts. The BP share price forecast is 505p, which implies 30% upside potential at the current trading level.
Year-to-date, BP shares have lost over 17% in trading.
