INEOS completes the acquisition of the North Sea Forties Pipeline System and Kinneil Terminal from BP
The completion of the deal consolidates INEOS’ position as a top ten company in the North Sea and the largest privately owned exploration and production business operating in the energy basin.
The FPS business is a natural fit for INEOS. Now with the responsibility for a strategic UK asset that delivers almost 40% of the UK’s North Sea oil and gas output, INEOS has further strengthened its long term oil and gas activity.
300 people have transferred to INEOS FPS Limited, the newly formed business that will be part of INEOS Limited.
INEOS FPS CEO, Andrew Gardner says, “This represents another very significant deal for INEOS. The acquisition reunites North Sea and Grangemouth assets under INEOS ownership. INEOS is now the only UK company with refinery and petrochemical assets directly integrated into the North Sea and this deal provides the platform to potential future offshore INEOS investments.”
INEOS has today completed its acquisition of the Forties Pipeline System (FPS) and associated pipelines and facilities from BP. The 235-mile pipeline system links 85 North Sea oil and gas assets to the UK mainland and the INEOS site in Grangemouth, Scotland, delivering almost 40% of the UK’s North Sea oil and gas production.
Ownership and operation of FPS, the Kinneil gas processing plant and oil terminal, the Dalmeny storage and export facility, sites at Aberdeen, the Forties Unity Platform and associated infrastructure has now transferred to INEOS FPS, together with approximately 300 personnel.
Andrew Gardner, CEO INEOS FPS said, “Our acquisition of the Forties Pipeline System and associated assets together with its highly skilled workforce is significant and strategic. It demonstrates INEOS’ commitment to securing a competitive long-term future for this critical piece of oil and gas infrastructure and provides the platform to potential future offshore INEOS investments. We will bring our focus and proven track record on safety, reliability and excellence in operations and apply them throughout the FPS business.”
The deal consolidates INEOS’ position as a top ten company in the North Sea. It further expands the INEOS oil and gas business interests following the acquisitions of the Breagh and Clipper South gas fields in the Southern North Sea from Letter1 in 2015 and the Dong Oil and Gas business from DONG Energy at the end of September this year. Twenty per cent of the oil that passes down the Forties pipeline feeds the P refinery that in turn provides more than 80% of Scotland’s transport fuels.
Notes to Editor.
The acquiring entity is INEOS FPS Limited, which is a subsidiary of INEOS Limited but is not part of the IGH SA Group. INEOS FPS is a UK-registered company.
The Forties pipeline was opened in 1975 to transport oil from BP’s Forties field, the UK’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 21 companies. In 2016, the pipeline’s average daily throughput was 445,000 barrels of oil and some 3,500 tonnes of raw gas a day. The system has a capacity of 610,000 barrels of oil a day. BP sold its interests in the Forties field to Apache in 2003 and sold its Grangemouth refinery and petrochemical plants to INEOS in 2005.
The Forties Pipeline System primarily comprises a 169 kilometre (105 mile), 36” pipeline from the unmanned offshore Forties Unity platform to the onshore terminal at Cruden Bay. From there a 36” onshore pipeline transports the oil 209 kilometres (130 miles) south to the Kinneil facilities, adjacent to the Grangemouth refinery and chemical plant, where it is processed and stabilised before output is sent either for export via the Dalmeny terminal and Hound Point loading jetty or on to Grangemouth.
The acquisition encompasses the FPS business, existing customer contracts and assets including:
Forties Pipeline System (100%)
FPS equipment on Apache’s Forties Charlie platform.
Forties Unity platform.
BP’s interest in the GAEL N (54.3%), and GAEL S (30.5%) pipeline.
36” Forties sea-line.
St Fergus-to-Cruden Bay natural gas liquids line.
Cruden Bay terminal.
36” Cruden Bay-to-Kinneil land-line.
Netherley, Brechin and Balbeggie pumping stations.
LPG storage and export at Grangemouth and Grangemouth docks.
Dalmeny tank farm and pipelines to Hound Point.
Hound Point jetties.
Richard Longden (INEOS)0041 21 627 7063 or 0041 7996 26123
Andrew McLachlan (Media Zoo)020 7384 6980 or 07931 377162
Joseph Wade (Media Zoo) 020 7284 6980 or 07758 074576