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The energy world is buzzing with speculation as British oil major BP finds itself at the center of a potential takeover storm. The United Arab Emirates’ state-owned oil giant, Abu Dhabi National Oil Company (ADNOC), has reportedly set its sights on BP’s lucrative liquefied natural gas (LNG) assets, with whispers of a full-blown acquisition not entirely off the table. As BP navigates this high-stakes chess game, a critical question looms: would relocating its headquarters to the United States before divestitures give BP a strategic edge? Let’s dive into the drama and unpack the possibilities.
The ADNOC Gambit: A Strategic Play for BP’s Gas Assets
BP’s prolonged underperformance compared to peers like ExxonMobil and Shell has made it a prime target for acquisition. Its stock price, down over 4% year-to-date as of June 2025, reflects investor skepticism, despite a strategic pivot under CEO Murray Auchincloss to double down on hydrocarbons. This shift, which includes a $10 billion annual investment in oil and gas through 2027 while slashing renewables spending, has yet to fully restore market confidence.
Enter ADNOC, a cash-rich juggernaut led by CEO Sultan al-Jaber, who is reshaping the company into a global energy titan. Bloomberg reports that ADNOC, through its international arm XRG, is eyeing BP’s LNG assets as a cornerstone of its ambition to dominate the global gas market. Posts on X echo this sentiment, noting ADNOC’s focus on BP’s gas fields and its aggressive deal-making, with XRG targeting an $80 billion enterprise value.
ADNOC’s interest isn’t new. In 2024, the UAE giant explored a full takeover of BP, valued then at £88 billion ($110.3 billion), but backed off due to strategic misalignments and political concerns, including the UK’s National Security and Investment Act, which could block foreign acquisitions of critical energy assets. Today, ADNOC appears more focused on cherry-picking BP’s LNG portfolio, potentially partnering with other bidders to carve up the British firm’s divisions.
The two companies share a deep history, from joint ventures in Abu Dhabi to a recent gas field partnership in Egypt. Former BP CEO Bernard Looney’s presence on XRG’s board alongside al-Jaber adds a layer of intrigue, suggesting insider familiarity could smooth negotiations. Yet, analysts like Maurizio Carulli of Quilter Cheviot argue a full takeover is unlikely, as ADNOC has little interest in BP’s oil assets. Instead, BP’s LNG fields and even its Castrol lubricants unit—previously courted by Aramco and private equity firms—could be the real prizes.
BP’s Dilemma: Stay in London or Head for the U.S.?
As ADNOC circles, BP faces pressure to maximize shareholder value while fending off predators. One bold idea gaining traction is relocating its headquarters to the United States before selling assets. Companies like CRH and Flutter have recently shifted listings to New York, citing higher valuations and deeper investor pools. Shell’s CEO has also hinted at exiting London, calling its stock “massively undervalued.”
Why Move to the U.S.?
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Higher Valuations: BP’s current price-to-earnings ratio of 7.54 lags far behind ExxonMobil’s 12.98, reflecting London’s depressed market. U.S. markets, with their appetite for energy stocks, could boost BP’s valuation, making it a less affordable takeover target and increasing returns on asset sales.
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Access to Capital: The U.S. offers a larger pool of investors and liquidity, critical for funding BP’s hydrocarbon-focused strategy. A New York listing could attract American institutional investors, bolstering its share price.
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Strategic Positioning: A U.S. base could align BP with the epicenter of global energy consolidation, where mega-mergers like ExxonMobil’s acquisition of Hess Corporation are reshaping the industry. It might also deter foreign state-owned buyers like ADNOC, given U.S. regulatory scrutiny of foreign acquisitions.
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Asset Sale Appeal: BP’s U.S. assets, including its Whiting refinery in Indiana—the Midwest’s largest—could fetch premium prices in a domestic market hungry for energy infrastructure. Moelis & Co.’s Muhammad Laghari told Bloomberg that BP’s U.S. oil assets could draw strong interest, especially after challenges selling units like Castrol.
Why Stay in London?
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Political Protections: The UK government has historically signaled it would block foreign takeovers of BP due to its strategic importance. Relocating could weaken these defenses, exposing BP to hostile bids.
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Existing Relationships: BP’s long-standing ties with ADNOC and other Middle Eastern players are rooted in its London base and regional history. A U.S. move might complicate these partnerships, critical for its Middle East expansion.
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Operational Continuity: Relocating is a costly, complex process. BP’s ongoing strategic reset, which Auchincloss claims is “off to a great start,” might be disrupted by a transatlantic shift, distracting from efforts to stabilize its stock price.
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Regulatory Risks: U.S. antitrust and national security regulations could complicate asset sales or mergers, especially if BP’s U.S. assets are deemed critical infrastructure.
The Energy News Beat Take: What’s BP’s Best Move?
ADNOC’s interest in BP’s LNG assets is a wake-up call. With its market value down a third in just over a year to below £60 billion, BP is vulnerable. Selling assets like its LNG fields or Castrol could raise billions, but at the risk of shrinking its portfolio and inviting further takeover bids. A full acquisition by ADNOC seems improbable—analysts on X call it a “0% probability event” due to UK oversight and ADNOC’s focus on gas—but other majors like Equinor or ConocoPhillips could emerge as suitors.
Relocating to the U.S. could be a game-changer. Higher valuations and access to capital would strengthen BP’s hand, potentially fetching better prices for assets like its Whiting refinery or LNG fields. However, the move carries risks, from regulatory hurdles to alienating UK stakeholders. BP’s recent pivot to hydrocarbons suggests it’s doubling down on its core business, and a U.S. base could amplify this strategy’s impact. Yet, staying in London offers stability and government backing, crucial for navigating ADNOC’s advances.
For now, BP is playing defense, with Auchincloss touting its strategic reset to restore investor faith. Whether it stays put or makes a bold leap across the Atlantic, one thing’s clear: the energy sector’s eyes are locked on BP, and ADNOC’s next move could set the stage for a seismic shift.
Stay tuned to Energy News Beat for the latest on BP’s high-stakes saga. Will it outmaneuver ADNOC, or is a blockbuster deal on the horizon? Drop your thoughts below!
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The post Energy News Beat: BP Takeover Speculation Ignites as ADNOC Eyes Gas Assets – Should BP Relocate to the U.S. Before Selling? appeared first on Energy News Beat.
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