Given the current Coronavirus emergency gripping the world, it’s perfectly understandable for most people to yearn for things to return to normal. But, from a business perspective, this is no time to be stuck in the past – nostalgia doesn’t pay the wages. The commercial reality is that we must use the current situation to implement radical and necessary change in the interests of both survival and progress.
UnitBirwelco’s fortunes are closely linked to the energy industry, which is currently undergoing a period of massive upheaval – some of it brought about by COVID-19, but some because of growing environmental concerns. The recent actions of companies far larger than us in the sector are an indication of the scale of the shift taking place right across the globe. The numbers involved are mind-boggling.
For example, BP recently decided to write-down estimates of revenue in the current quarter by US$17.5bn, based on the value of Brent Crude at US$55 a barrel (down from US$75). What’s really frightening is that this may not prove to be enough; the current market price of crude in America is hovering around US$40 a barrel, having recovered from a low point of US$20.
Undeterred – and having made a pledge to eliminate its carbon footprint from oil and gas by 2050 – BP has gone to the market to raise US$12bn, taking advantage of current low interest rates to strengthen its balance sheet. Very opportunistic, certainly, but also very pragmatic and realistic – BP has its eyes focused on the future.
Turning to coal, it’s encouraging to note that Drax Group fired up one of its coal-burning power stations in the UK for the first time in almost 68 days – apparently to carry out tests after maintenance, not to generate electricity for the National grid. By contrast, Germany recently opened a brand new coal plant in defiance of the ‘Green’ lobby, proving that, in some countries, economic recovery still takes priority over environment concerns.
It’s reassuring to know that, just as this country was at the front of the curve when we opened our first coal-powered station in 1882, we are still showing others the way forward nearly 140 years later. The trick is to implement change while you still have the choice. And whilst not in the same league as BP, UnitBirwelco will continue to do its modest best to prepare for the future.