INEOS buys North Sea gas fields
- INEOS has today agreed to purchase all of the UK North Sea gas fields owned by the DEA Group, the German-based oil and gas firm owned by the LetterOne Group.
- INEOS has moved fast to acquire these high quality, low risk assets. Once the deal closes, the platforms, infrastructure and the highly skilled team that runs them will form part of the new INEOS Upstream business division based in London.
- The fields, the largest of which are Breagh and Clipper South in the Southern North Sea, provide up to 8% of the UK’s gas, enough gas to warm 1 in 10 British homes. The fields themselves are well positioned, close to INEOS’ assets in the North East and Scotland.
- Jim Ratcliffe, INEOS chairman says, “We are pleased to acquire a strong portfolio of natural gas assets and bring on board a highly successful and experienced North Sea industry team. INEOS has been very open about its intention to make strategic investments in the North Sea and this acquisition is our first step in fulfilling this goal. It will also help our UK petrochemical assets to have ongoing access to competitive energy”.
INEOS today announced that it has agreed to acquire a strong portfolio of natural gas assets in the North Sea from a UK subsidiary of DEA Deutsche Erdoel AG, which is part of the LetterOne Group.
INEOS Upstream will acquire gas fields, including the Breagh and Clipper South fields in the Southern North Sea which are well positioned close to INEOS’ sites in the North East and Scotland. The annual production from these fields account for 8% of the UK’s annual gas production, enough gas to warm 1 in 10 British homes.
INEOS is a new entrant to the North Sea. However, the company has extensive experience in operating chemical plants of similar complexity to these offshore platforms.
As one of the world’s largest operators of chemical plants and a huge consumer of hydrocarbons these assets should make a significant contribution to INEOS’s European energy and feedstock strategy.
The company operates Scotland’s largest manufacturing complex at Grangemouth which is the only refining / petrochemicals complex directly attached to the North Sea.
INEOS has recently announced its intention to be the leading UK player in onshore gas development and, as part of the company's growing interest in energy production, is now evaluating additional opportunities in the offshore area.
As part of the company’s ongoing business planning, it has set up INEOS Upstream, a new oil and gas subsidiary of INEOS AG and is working with a number of top class North Sea oil and gas professionals. Their first task has been to conduct a strategic review of the potential opportunities in the North Sea to see whether these are suitable to play a part in the development of the INEOS Upstream business.
Rob Nevin, Chairman INEOS Upstream, says, “INEOS and its JV partners are huge consumers of natural gas, ethane, propane and condensates. North Sea oil and gas can make a significant contribution to providing these feedstocks as well as servicing our energy needs.”
INEOS also owns a number of Shale gas licences in England and Scotland and is investing a further $1 billion in an ambitious project to bring US Shale gas to the UK and to Norway.
Jim Ratcliffe, INEOS chairman adds, “The acquisition of these North Sea gas fields is a great entry point for the INEOS Upstream business. They are high quality, low risk assets and they come with a highly experienced management team. Whilst no decisions have yet been made, we will continue to evaluate other opportunities in the North Sea”.
Notes to the Editor:
The transaction is subject to competition clearance from the European Commission. We do not foresee any major issue with receiving this clearance, and are hopeful for a completion date in later this year.
The existing management team at DEA’s UK business will stay in place and run the business post-completion. This team has successfully developed the assets that have made this transaction interesting to INEOS, and has the full support of INEOS.
Richard Longden (INEOS) 0041 21 627 7063 or 0041 7996 26123
Mark Killick (Media Zoo) 020 7384 6980 or 07836 634449
Andrew McLachlan (Media Zoo) 020 7384 6980 or 07931 377162
Hannah Brandstaetter (Media Zoo) 020 7384 6980 or 07896 776554