BP has signed an agreement to sell its Forties Pipeline System (FPS) business to energy giant Ineos for $250m.
The FPS business compromises assets including the main Forties offshore and onshore pipelines and other associated pipeline interests and facilities.
The 235m Forties pipeline system connects 85 North Sea oil and gas assets to the UK mainland and the INEOS site in Grangemouth in Scotland.
Under the terms of the deal, Ineos will acquire the ownership and operation of FPS, the Kinneil terminal and gas processing plant, the Dalmeny terminal, sites at Aberdeen, the Forties Unity Platform and associated infrastructure.
BP North Sea regional president Mark Thomas said: “This allows us to further focus our North Sea business around our core offshore assets – bringing new fields into production, redeveloping and renewing existing producing facilities and acquiring and exploring new acreage and interests through licence rounds and farm-ins.
The deal, which is subject to partner, regulatory and other third party approvals, is targeted for completion in Q3 2017. It does not affect BP’s existing rights to capacity in FPS.
INEOS chairman and CEO Jim Ratcliffe said that the Forties Pipeline System is a strategic asset for the company in the UK.
BP group chief executive Bob Dudley commented: “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.”
Ineos said that the deal makes it the only UK company with refinery and petrochemical assets integrated directly into the North Sea.
Image: The Forties Unity platform in the North Sea. Photo: courtesy of INEOS.