INEOS expands North Sea oil and gas operations

Article by Neil Clark

INEOS will move into deep water oil and gas exploration, after agreeing to buy a majority stake in two Northern Gas Fields exploration licences.

Credit: INEOS

This means that INEOS now has positions in the four fields that make up the Lyon cluster in the West of Shetland: Lyon, Tobermory, Bunnehaven and Cragganmore. It says that initial survey work indicates extensive gas reserves of between 3–5trn ft3 are in the cluster – matching major fields such as Elgin Franklin, Britannia and Laggan Tormore.

A statement from the petrochemicals company said that existing Lyon gas discoveries were all candidates to tie-back into a hub, adding: “If successful it could be large enough to form a new gas-hub development similar to the Laggan-Tormore fields, which have been developed with subsea infrastructure and pipelines to the Shetland Gas Plant.”

INEOS Oil & Gas CEO Geir Tuft said: “INEOS intends to become a significant player in this area.  This deal confirms our aim to take a leading role to develop the Northern Gas Fields using the significant infrastructure investments already made West of Shetland.”

The two-third shares were taken from licence operator Siccar Point Energy E&P for an undisclosed sum, and complement INEOS’ portfolio of producing assets and discoveries West of Shetland announced in May this year, from DONG E&P in a £1bn (US$1.3bn) deal.

Earlier this year, it completed the acquisition of the Forties Pipeline System in the North Sea from BP in a deal worth up to US$250m. The system is responsible for delivering 40% of the UK’s oil production, and connects 85 North Sea assets to the mainland.

INEOS also bought Swiss football club FC Lausanne-Sport this month, and in October agreed to buy British motorcycle fashion house Belstaff.

Article by Neil Clark

Staff Reporter, The Chemical Engineer

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