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BP sells North Sea oil pipeline for $250 million

Staff Writer |
BP confirmed it has agreed the sale of the UK North Sea's largest oil pipeline to UK-based chemicals company INEOS.

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BP said it will sell the Forties Pipeline System, including offshore and onshore pipelines and facilities, to INEOS for up to $250 million. This will comprise an initial $125 million cash payment and an earn-out arrangement of up to $125 million over seven years.

The deal is expected to complete during 2017. BP said it will begin consultation with "in-scope staff" over the 300 jobs associated with operating and supporting the Forties Pipeline business.

The Forties pipeline was opened in 1975 to transport oil from the Forties field and now carries liquids production from 85 fields in the Central and Northern North Sea, with a capacity of 575,000 barrels of oil a day.

"BP is returning to growth in the North Sea as we bring important new projects, including the Quad 204 redevelopment and Clair Ridge, into production and increase new exploration.

"While the Forties pipeline had great significance in BP's history, our business here is now centred around our major offshore interests west of Shetland and in the Central North Sea," said Bob Dudley, chief executive of BP.

"The pipeline has long been an important feedstock supplier to INEOS at Grangemouth.

"We believe that through also owning FPS, INEOS will be able to realise greater integration benefits and help secure a competitive long-term future for this important piece of UK oil and gas infrastructure," added Dudley.

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