- BP plans to sell stakes in two of the UK’s flagship carbon capture and storage (CCS) projects: the Net Zero Teesside Power plant and the Northern Endurance Partnership (NEP) CO₂ transport and storage network.
- BP insists the sale is about bringing in new partners at the ‘right time’, but the decision also reflects a broader strategic retrenchment under new CEO Meg O’Neill, who is prioritising debt reduction and higher-return oil and gas investments.
- The projects remain central to the UK government’s industrial decarbonisation strategy, with ministers relying on CCS to preserve heavy industry while meeting net-zero targets.
BP is preparing to dilute its ownership in two of Britain’s most politically important decarbonisation projects, marking another sign of the company’s accelerating strategic shift away from the low-carbon agenda championed by former chief executive Bernard Looney.
According to reports, the oil major intends to sell portions of its equity in the Net Zero Teesside (NZT) Power project and the Northern Endurance Partnership (NEP) CCS network in northern England. BP did not disclose how much equity it plans to offload or identify potential buyers.
The timing is significant. Both projects recently secured financial close and moved into construction, meaning BP is seeking to bring in new investors at a point where some of the biggest regulatory and commercial uncertainties have already been cleared. BP told Reuters it viewed this as “the right time” to sell part of its stakes after reaching “major milestones”.
At face value, the move could be interpreted as a relatively standard infrastructure recycling strategy: develop large-scale assets, de-risk them, then monetise part of the position to recycle capital elsewhere. But in BP’s case, the decision also sits within a much wider corporate pivot.
Since taking over as chief executive in April, Meg O’Neill has moved quickly to reshape the company around what BP increasingly sees as its core strengths: upstream oil and gas production and higher-margin conventional energy assets. Reuters recently reported that BP is also reviewing whether to sell part or all of its UK North Sea portfolio as part of a broader effort to cut debt and focus investment on more profitable hydrocarbons projects.
That strategic reset represents a marked departure from the Looney era. Under Looney, BP aggressively repositioned itself as an integrated energy transition company, investing heavily in renewables, hydrogen, EV charging and carbon capture. CCS in particular was presented as a cornerstone of BP’s future UK business model.
The Teesside cluster became perhaps the clearest symbol of that ambition.
The Northern Endurance Partnership, jointly backed by BP, Equinor and TotalEnergies, is designed to transport and permanently store industrial carbon emissions beneath the North Sea. Initially, the project is expected to handle around 4 million tonnes of CO₂ annually.
Meanwhile, the Net Zero Teesside Power project, a BP-Equinor joint venture, aims to become the world’s first commercial-scale gas-fired power station fitted with carbon capture technology. The 742MW plant is expected to supply electricity to roughly one million UK homes from 2028 while capturing the vast majority of its emissions.
Together, the projects form the backbone of the UK’s “East Coast Cluster” strategy, which ministers see as essential for decarbonising heavy industry in Teesside and the Humber without forcing industrial shutdowns. The previous Conservative government committed up to £21.7 billion in long-term support for CCS infrastructure, a policy the Labour government has broadly maintained.
Economic reality
For energy secretary Ed Miliband, the projects are strategically important not only for climate goals but also for industrial policy. CCS allows government to argue that Britain can retain steel, chemicals, refining and gas-fired generation capacity while still moving toward net zero.
Yet the economics remain heavily contested.
Supporters argue CCS is indispensable for “hard-to-abate” industrial sectors and for dispatchable low-carbon power generation. Critics counter that many projects remain commercially fragile, highly subsidy-dependent and technologically unproven at scale. Even supporters acknowledge that the business model requires decades of regulatory certainty, state backing and patient capital.
That tension helps explain why BP’s stake sale matters beyond the company itself.
The question is not simply whether BP wants to rebalance its portfolio. It is whether a deep enough pool of infrastructure and pension capital now exists to treat CCS networks as long-term, utility-style assets rather than speculative transition bets. If credible buyers emerge quickly, it would strengthen the argument that CCS is maturing into an investable infrastructure sector. If not, concerns about long-term commercial viability may intensify.
There is also a political dimension. BP’s retrenchment risks feeding criticism that oil majors are selectively retreating from energy transition commitments once projects become capital-intensive or returns appear less attractive than upstream hydrocarbons. Environmental groups have already framed the sale as evidence that BP is continuing to unwind Looney’s green agenda.
For the UK, however, the projects themselves are unlikely to disappear. The government is too heavily invested politically and financially in CCS deployment, particularly in industrial regions where decarbonisation is tied directly to jobs and economic regeneration.
The more important question now is who ultimately owns Britain’s future carbon infrastructure – and whether the investment community shares ministers’ confidence that carbon capture can evolve from subsidised demonstration projects into commercially durable energy systems.
