A Norwegian energy giant is cutting its investment in renewable energy in half and switching to oil and gas over the next two years.
Equinor’s chief executive Anders Opedal announced the policy as the transition to greener energy was moving more slowly than expected – and is getting more expensive.
He added that the firm’s customers did not want to commit to long-term contracts.
Instead, the power boss says he is confident that extracting resources from Rosebank, a large new oil field in the North Sea, would go ahead.
This is despite a court ruling that consent had not been awarded lawfully.
“We are scaling down our investments in renewables and low carbon solutions because we don’t see the necessary profitability in the future,” Mr Opedal told the BBC.
Equinor says it will reduce investments in renewables to $5billion (just over £4billion) over the next two years. This is down from about $10bn (around £8billion).
In addition, the company will axe a target to spend half of its fixed assets budget on greener products by 2030.
Instead, Equinor will be increasing its oil and gas production by 10% over the next two years as the firm changes tack.
Mr Opedal admitted that the subject of renewable energy is divisive, but said the move was good for the UK economy.
He said: “This is an important project for us. It provides local jobs in Scotland, local jobs in the UK, so we think this project will move forward.
“We think that Western Europe and the UK should produce the oil and gas it uses instead of being dependent on other countries outside Europe.”
The energy chief also appeared to welcome the US President Donald Trump’s vow to “drill, baby, drill”. Although, he added that energy prices, not Mr Trump, would be the main factor in what he decides to do in the future.
Mr Opedal said: “When I hear ‘drill, baby, drill’, I see that as a positive sentiment to the oil and gas business but I think companies will always decide on drilling programs based on price signals.”
