Commission Clears Ineos-BP Pipeline Deal
The European Commission has approved Ineos’ acquisition of BP’s North Sea pipelines for up to $250 million. The deal includes the Forties Pipeline System (FPS) that links 85 oil and gas assets to the UK mainland and to the Kinneil terminal in Grangemouth, Scotland, which is adjacent to the Ineos refinery and chemical complex.
Terms of the deal include an initial cash payment of $125 million and a seven-year earn-out arrangement potentially worth another $125 million. About 300 BP staff supporting the operations are to transfer to Ineos.
Altogether, the pipeline has capacity to transport 575,000 bbl/d of oil from the UK’s first major offshore oil field – built by BP and opened in 1975 – to the UK mainland. Around 20% of the throughput goes to feed Ineos’ Grangemouth refinery.
Ineos will own and operate the Kinneil terminal, a gas processing plant, the Dalmeny terminal, various sites in Aberdeen, Scotland, and the Forties Unity Platform, along with other associated infrastructure.
According to the Commission, the proposed acquisition would raise no competition concerns because of its limited competitive impact on the market.
“The North Sea continues to present new opportunities for Ineos,” its chairman, Jim Ratcliffe, said. He said the pipeline system is “a UK strategic asset that was originally designed to work together to feed the Grangemouth refinery and petrochemical facilities.”