NORTH Sea Midstream Partners (NSMP) will acquire Total’s stake in two pipelines and the St Fergus Gas Terminal for £585 million.
The pipeline assets incorporate its interests in the Frigg UK pipeline and Total’s 67 per cent stake in the Shetland Island Regional Gas Export System (SIRGE) pipeline.
Following completion of the sale, which is subject to regulatory and customary approvals, the systems will be operated on behalf of NSMP by its operating partner, px Group.
Px Group currently operates NSMP’s Teesside gas processing plant. NSMP chief executive Andy Heppel said the company was excited by the acquisition of these assets.
“We see midstream infrastructure as crucial to the longevity of the North Sea and firmly believe that the independent ownership of such infrastructure can help maximise the ultimate economic recovery of the UKCS’s oil and gas reserves, consistent with the findings of the Wood Review.”
Total chief financial officer Patrick de La Chevardière said ttransferring ownership to an entity specialising in midstream UK assets created value for Total and ensures a long future for the facilities.
The Shetland Island Regional Gas Export System (SIRGE) is a 234 kilometre gas pipeline connecting the Shetland gas plant to the FUKA pipeline.
Originally constructed in 1977, the Frigg UK Pipeline (FUKA) is a 362 kilometre gas pipeline that was built to connect the Frigg field on the UK – Norway median line to the St Fergus Gas Terminal in Scotland.
The St Fergus Gas Terminal is a threetrain processing plant with a capacity of 2,648 million cubic feet of gas per day, currently serving over 20 fields.
With the coming start-up of the LagganTormore project in the West of Shetland area, Total is opening up its third hub in the UK and a new frontier gas production area for the industry.
Total said by the end of 2015, it is expected to become the largest producing oil and gas company in the UK and will remain a major player in the North Sea offshore industry for many years to come.