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Ineos in exclusive talks with ConocoPhillips for North Sea assets

November 20/2018

MOSCOW (MRC) -- Ineos, the privately owned energy and chemicals group run by Britains richest man, is in exclusive talks with US oil major ConocoPhillips to acquire its assets in the North Sea, reported FT.

The potential deal, which has a price tag of more than USD3bn according to industry sources, could transform Sir Jim Ratcliffes company into a major operator in North Sea oil and gas production, building on other acquisitions and its ownership of infrastructure, refineries and chemical plants fed by the basin.

People familiar with the sale process said Ineos had paid ConocoPhillips a "substantial" deposit to give it exclusivity over the talks for three months, fearing competition from other buyers including private equity companies that have a growing role in the North Sea.

The ConocoPhillips assets are one of a handful on the block that give companies an opportunity to acquire a substantial North Sea footprint at a time when the energy majors, particularly from the US, have been scaling back in the mature basin to focus on the US shale sector and other prospects.

A spokeswoman for ConocoPhillips said it was in "exclusive negotiations with Ineos" for its UK assets, excluding the Teesside oil terminal and London.

If a deal is reached it would be the latest audacious move by Sir Jim who has built his business empire by borrowing to fund acquisitions in the last decade. Ineos is Britains biggest privately owned company with sales of USD60bn and earnings before interest, tax and other charges of USD7bn last year.

Sir Jim founded the company in 1998 and owns a majority stake in the business. The company has expanded from its petrochemicals roots into an industrial conglomerate with positions in other industries including shale exploration, automotive and fashion. Last week Ineos added the resins business of US-based Ashland Global Holdings in a USD1.1bn deal.

Ineos also owns the Grangemouth refinery and petrochemical sites in Scotlands central belt, and the associated Forties Pipeline System that delivers much of the North Sea oil and gas to shore.

The ConocoPhillips assets include a 7.5 per cent interest in the Clair field, which the US company had already disposed of a 16.5 per cent stake in July through an asset swap with BP.

Neptune Energy, a private equity backed energy company run by former Centrica chief executive Sam Laidlaw, is said to have also been in the running for the ConocoPhillips assets. Chrysaor, another private equity backed group that bought a host of North Sea assets from Royal Dutch Shell last year, was also in the running, people familiar with the talks said. Both companies declined to comment.

Ineos confirmed on Sunday it was in talks with ConocoPhillips, which were first reported by the Sunday Times, but did not comment on the exclusivity arrangement.

As MRC informed before, in November 2017, Ineos 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 UKs North Sea oil and gas production.

Ineos Group Limited is a privately owned multinational chemicals company consisting of 15 standalone business units, headquartered in Rolle, Switzerland and with its registered office in Lyndhurst, United Kingdom. It is the fourth largest chemicals company in the world measured by revenues (after BASF, Dow Chemical and LyondellBasell) and the largest privately owned company in the United Kingdom.


mrcplast.com
Author:Margaret Volkova
Tags:shale gas, gas processing, petrochemistry, BP Plc, ConocoPhillips, Ineos, UK, USA.
Category:General News
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