BP scanning for renewables deals for life beyond oil – why not go for geothermal?
Bloomberg reports this week on BP's look into renewables to prepare for a life beyond oil, question is if geothermal could be an interesting proposition - we do think so.
Earlier this week, Bloomberg reported that BP “Is ‘Scanning’ for Renewables Deals to Plan for a Life Beyond Oil”.
The news piece reports that the company plans not to be left behind in the new-energy shift. “We haven’t made really big bets but we’re scanning and screening everything” to assess renewables opportunities, Chief Executive Officer Bob Dudley said Tuesday. BP must “get its balance sheet really strong, and then we’ll be able to do whatever we think is the right thing to do.”
The company has stepped into the solar market with a recent investment in Europe following Shell and Total, that are invested in offshore wind and solar-panel production.
Essentially it shows that Big Oil is preparing for a future dominated by clean energy, the question who of those firms will be looking at geothermal.
Based on technology cross-over possibilities and the understanding of a resource-dominated business, geothermal should be on the radar of the big oil firms.
Question though is if it is attractive enough. In the past, the oil firms have neglected geothermal simply due to the fact is that the project sizes were too small and the utility-returns-based business model of geothermal is a bit far off from the short-returns in the commodity-driven business model of the oil sector.
But a fundamental shift is happening, and one can only hope oil firms make the move into geothermal.