BP Exits Bay du Nord Project, Equinor Takes Full Ownership

BP has announced its decision to exit the US$10 billion Bay du Nord deepwater oil project offshore eastern Canada, selling its non-operated stake to operator Equinor for an undisclosed amount. The UK supermajor stated that the move is part of its ongoing "portfolio simplification" efforts and a focus on disciplined capital allocation across its global business. Gordon Birrell, BP’s executive vice president for upstream, emphasized that the company is "exercising strict capital discipline, allocating it to the opportunities that create the most value for BP."

Transaction Details and Stake Changes

The transaction will transfer BP's average working interest of 37.2% across 10 licences linked to the project to Equinor, increasing the Norwegian company's stake to 100%. However, Equinor plans to seek one or more partners to replace BP as the project progresses. BP will retain full ownership of two separate exploration licences it holds offshore Newfoundland & Labrador. Financial terms were not disclosed, and the deal is subject to regulatory approvals and closing conditions. Any accounting impacts will be outlined in BP's second-quarter results.

Equinor's Commitment and FID Timeline

Equinor stated that the transaction provides "increased flexibility" as it aims to take a final investment decision (FID) on Bay du Nord in early 2027, subject to market conditions, regulatory approvals, and internal approvals. Philippe Mathieu, Equinor’s executive vice president for international E&P, noted that the company has "strengthened Bay du Nord by improving the business case and reducing key risks," and that the transaction "reflects our confidence in the project." An Equinor spokesperson confirmed that there is "no change regarding timing or our work to progress" the project, describing Bay du Nord as a "world class asset sited in a stable and supportive environment." The spokesperson also revealed that Equinor "has agreed to pay BP an undisclosed amount upon FID."

Project Status and Development Plan

Located in the Flemish Pass basin, roughly 500 kilometres offshore, Bay du Nord is Canada's only significant offshore oil project. It is due to be exploited through a phased series of subsea developments tied back to a newbuild floating production, storage, and offloading (FPSO) vessel. The project is currently in its front-end engineering and design (FEED) phase, with ongoing work focused on "strengthening capital efficiency, execution planning, and overall project robustness." Equinor noted that "constructive engagement with provincial and federal governments has supported progress through key milestones and will remain important as the project continues to advance."