INEOS revealed its plans to invest £1bn across midstream, power and downstream sectors in the UK, with the bulk of it to be made on the Forties Pipeline System.
The UK-based company will invest £500m in the 500km long Forties Pipeline System (FPS) with an objective to extend the life of the midstream asset into the 2040s.
The investment will also be used for overhauling the reliability of the pipeline system, said the company. As part of it, the company will look to modernize the environmental systems and implement the latest technology into the systems.
Furthermore, the investment is expected to revive the pipeline system, thereby creating a long-term asset that copes up with the requirements of North Sea oil and gas producers, said INEOS.
Forties Pipeline System was acquired by the company along with associated pipelines and facilities including the Kinneil Terminal in Scotland from BP in October 2017 for $250m.
Commissioned in 1975, the pipeline system can deliver up to 600,000 barrels of oil produced in the North Sea for refining every day. The Forties Pipeline System transports 40% of the oil and gas produced in the UK to the mainland.
INEOS FPS CEO Andrew Gardner said: “North Sea oil and gas producers are telling us that they want to be in the North Sea well into the 2040s so we are making this commitment to be there with them. Following acquisition of FPS in 2017 we are now embarking on a period of investment that will guarantee that the system can support them for decades to come.”
The company announced an investment of £150m to build a new Vinyl Acetate Monomer (VAM) plant in Hull. The capacity at the VAN plant in Hull is likely to be 300,000 tons per year of Vinyl Acetate Monomer, which is an intermediate petrochemical.
The other investment, to be of £350m, will be made for the development of a new steam and power plant at the company’s Grangemouth site.
INEOS O&P UK CEO Tobias Hannemann said: “This investment forms part of our wider plans to secure a bright future for manufacturing at Grangemouth and will continue its renaissance as a world class petrochemicals site while supporting the refinery, FPS and wider UK economy.”