Dive Brief:
- BP is reshaping its organizational structure amid efforts to simply its operations, the oil company and convenience retailer announced on Tuesday.
- Effective July 1, BP will be split into upstream and downstream segments, replacing the current three-segment structure that also includes its “customers and products” division, according to the announcement.
- BP’s convenience retail business, which currently falls under customers and products, is being shifted to the downstream segment, according to the announcement.
Dive Insight:
The realignment comes as BP continues its years-long portfolio review, which has impacted the company’s U.S. convenience retail network through team restructurings and c-store divestitures. A spokesperson from BP declined to comment when asked how the new organizational shift might impact the company’s convenience retail business.
The new two-segment model will see upstream encompass BP’s oil and gas exploration, development and production activities. The model will also include BP’s upstream joint ventures and its renewable natural gas and carbon capture and storage businesses. Besides convenience, downstream will include refining, terminals, pipelines, mobility, biofuels, aviation, hydrogen and Castrol.
BP’s supply, trading and shipping arm will continue to operate across both segments, while its renewable businesses, including solar and offshore wind, will join the technology function.
“Over the past two months, I have spent time with our teams, partners and investors around the world, and I am encouraged by the strong support for our strategic direction,” CEO Meg O’Neill said in the announcement. “Focusing bp around two distinct segments is an important step in accelerating delivery. It will reduce complexity and strengthen execution.”
BP has hired new leadership for each division. Gordon Birrell has been named executive vice president of upstream, and Richard Harding has been named interim EVP of downstream. A recruitment process is underway to appoint a permanent EVP of downstream.
“[BP] has an incredibly capable team, with deep expertise across the oil and gas value chain,” O’Neill said. “We are capitalizing on opportunities across our portfolio, strengthening the balance sheet and unlocking sustainable growth. We are moving firmly towards a simpler, stronger and more valuable bp.”
