The chemicals firm INEOS has agreed to acquire the Forties Pipeline System (FPS) and its associated pipelines and facilities from oil major BP in a deal worth up to $250mn.
The deal, announced on 3 April, means that INEOS is now responsible for an asset that delivers almost 40% of the UK’s North Sea oil and gas supply. The 235 mile Forties pipeline system links 85 North Sea oil and gas assets to the UK mainland and the INEOS refinery at Grangemouth in Scotland.
This will make INEOS the only UK company with refinery and petrochemical assets directly integrated into the North Sea. The terms of the deal will see INEOS make an initial cash payment of $125mn on completion and an additional earn-out arrangement over a seven-year period that could total $125mn. The deal is hoped to be completed in Q3 of this year.
BP Group Chief Executive, Bob Dudley, said: “We believe that through also owning FPS, INEOS will be able [to] produce greater efficiencies and help secure a competitive long-term future for this important piece of UK oil and gas infrastructure.”