BP agreed to sell the Forties Pipeline System (FPS) business in the U.K. North Sea, to petrochemical producer INEOS for $250 million, BP announced on Monday.
The sale of the oil pipeline business contains assets including the main Forties offshore and onshore pipelines and other associated pipeline interests and facilities, according to the company's statement.
INEOS will pay BP up to $250 million for the business, comprising a cash payment of $125 million on completion and an earn-out arrangement over seven years that totals up to $125 million, according to the press release.
Subject to the receipt of regulatory and other third party approvals, BP aims to complete the sale and transfer of operatorship during 2017, the press release said.
Built, owned and operated by BP, the Forties pipeline was opened in 1975 to transport oil from the Forties field, the U.K.’s first major offshore oil field.
Today FPS carries liquids production from some 85 fields in the Central and Northern North Sea and several Norwegian fields on behalf of around 40 companies.
The system has a capacity to transfer 575,000 barrels of oil a day.
By Muhsin Baris Tiryakioglu