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BP is ready to make acquisitions. Why it goes beyond oil.

British oil giant BP is also considering an acquisition, the company revealed on Tuesday after reporting its first quarter results. But it’s not about buying an oil company. BP says it is considering buying something in the low-carbon industry, perhaps in an area like biofuels. The revelation is surprising because it comes as BP has abandoned some of its existing efforts to reduce carbon emissions amid weakening returns.

BP’s earnings, released Tuesday, fell below Wall Street expectations and the stock fell 3%.

Asked by an analyst on the conference call whether it would join its peers in increasing its oil capacity, BP CEO Murray Auchincloss said the company was not considering moving in that direction. Oil prices – now above $80 per barrel – are simply too high to find attractively priced acquisition targets. “I don’t want to make high-priced acquisitions,” Auchincloss said.

Clean energy is a different story. The WilderHill Clean Energy Index is down 24% this year.

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“With low-carbon energy currently in the doldrums, now is the time to take a counter-cyclical approach,” he said. BP has already added low-carbon assets at a time when solar and wind companies were struggling. BP agreed in November to buy Lightsource bp, a utility-scale solar and battery storage company in which it already had an equity stake.

“This is why we are making Lightsource bp at a countercyclical time. And watch the space: we could do even more things in the coming years in a countercyclical environment,” Auchincloss added.

BP has one of the most ambitious low-carbon programs among the oil majors, with plans to invest in 50 gigawatts of renewable energy projects by 2030. But lately the company has backed away from some low-carbon investments.

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In an interview with Barron’s, Auchincloss said the company’s plans for a major offshore wind farm near New York were on indefinite hold. The offshore wind market in the North East is “not mature” because there is not enough infrastructure to get the energy to where it needs to be delivered. “All infrastructure must be built.”

And BP has scaled back its plans to deploy chargers for electric vehicles in 12 countries. He now focuses on four. “There are eight countries where we are simply not going to pursue this, because the grid is not ready for it, the permits are not ready for it and the adoption of electric cars is not ready for this,” he said.

In general, traditional oil investors have urged oil companies not to invest in renewable energy because these projects have recently generated worse returns than oil drilling.

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This is why BP’s decision to seek deals in cleaner areas is surprising. Auchincloss didn’t give much indication of what type of company BP might buy, but he did mention biogas, biofuels, convenience stores and “electrification” among the areas of interest to him. (Convenience stores attached to gas stations and electric vehicle chargers are one of BP’s “transitional growth engines,” although they are still connected to fossil fuels.)

“I will have to be careful about this because as soon as I talk about it I will have too much competition,” Auchincloss said.

Write to Avi Salzman at [email protected]