BP Plc (LON:BP.) has announced it is selling a major North Sea pipeline operation to INEOS.
The somewhat symbolic move sees the oil major flogging the main Forties pipelines, which cover both onshore and offshore.
Bob Dudley, BP chief executive, highlighted that whilst the Forties pipeline had great significance in the company’s history it was now focussing on ‘important’ new North Sea projects such as the Quad 204 redevelopment and the development of the large Clair ridge project, both of which are in the West of Shetland area.
"The pipeline has long been an important feedstock supplier to INEOS at Grangemouth,” Dudley said in a statement.
“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."
The pipeline is symbolic in as much as it connected to the Fotries field, the North Sea’s first major field development, and with a capacity of 575,000 barrels per day it now carries production from some 85 fields – including some in Norwegian waters – on behalf of around 40 companies.
BP is selling the pipeline for US$250mln, with US$125mln coming in cash and the other half paid from a seven year earn-out.