Energy giant BP says it has made its largest oil and gas discovery this century as it shifts its focus away from renewable energy and back to fossil fuels.
The UK-based firm said on Monday that it is conducting tests at the site in deep water off Brazil’s west coast. The discovery could play a major role in BP’s plans to increase crude oil production.
Company executive Gordon Birrell says the discovery is “BP’s largest in 25 years” and that the firm will explore building a production hub there.
In February, BP slashed its planned investments in renewable energy and said it would spend billions of dollars more a year on its oil and gas operations, as it aims to boost investor confidence.
BP said it had found a roughly 500-metre area of oil and gas at the Bumerangue block in the Santos basin, 250 miles (400km) off Brazil’s west coast.
It said the discovery was the company’s biggest since the Shah Deniz gas field in the Caspian Sea in 1999.
The find adds to BP’s several other discoveries of energy reserves this year, including those in the Gulf of Mexico, which is called the Gulf of America by the administration of US President Donald Trump, and Egypt.
“This is another success in what has been an exceptional year so far for our exploration team”, said Mr Birrell, the firm’s executive vice president for production and operations.
BP’s attempt to transform itself into a “net zero” energy producer has faced major hurdles since it put the plan into action five years ago.
In 2020, the Covid-19 pandemic pushed it to a $5.7bn (£4.29bn) annual loss.
It also took a $25bn hit two years later from writing off a stake in its Russian energy business after the start of the Ukraine war.
BP’s share price has also come under pressure as it pumped billions of dollars into renewable energy, while rival companies benefitted from soaring oil and gas prices in the wake of Russia’s invasion of Ukraine.
BP shares rose by a little over 1% in London trading after the announcement.