BP announced that it has agreed to acquire Archaea Energy Inc., a leading producer of renewable natural gas (RNG) in the US.

Bioenergy is one of five strategic transition growth engines that BP intends to grow rapidly through this decade. BP expects investment into its transition growth businesses to reach more than 40% of its total annual capital expenditure by 2025, aiming to grow this to around 50% by 2030. 

In a move that will expand and accelerate the growth of its strategic bioenergy business, BP announced that it has agreed to acquire Archaea Energy Inc. The agreed acquisition, which is subject to regulatory and Archaea shareholder approval, will be for $3.3 billion in cash, as well as around $800 million of net debt.

Acquiring Archaea will expand BP’s presence in the US biogas industry, enhancing its ability to support customers’ decarbonization goals and also progressing its aim to reduce the average carbon intensity of the energy products it sells. BP aims to reduce that carbon intensity to net zero by 2050 or sooner.

Operates 50 RNG and landfill gas-to-energy facilities across US, with development pipeline supporting potential for around five-fold increase in RNG volumes by 2030. Doubles the EBITDA BP expects from biogas to around $2 billion by 2030; supports increase in BP’s aim for EBITDA from transition growth businesses by 2030 from $9-10 billion to more than $10 billion. Builds on BP’s existing biogas business – expanding in the US, a key fast-growing geography for biogas.