BP puts UK North Sea oil and gas assets up for sale as CEO pushes overhaul

BP has launched a formal sale process for its UK North Sea business, aiming to simplify its portfolio and cut debt under new CEO Meg O'Neill.

BP on Friday launched a formal sale process for its UK North Sea business as ‌new Chief Executive Officer Meg O'Neill accelerates a sweeping portfolio overhaul aimed at cutting debt and simplifying the oil major.

A day earlier British Prime Minister Andy Burnham said he planned to take a "pragmatic" approach to developing and using oil and gas resources in the North Sea, setting out his position after U.S. President ‌Donald Trump said the basin would be opened up. "The North Sea remains integral to the UK's energy system. However, as we focus our portfolio ‌and direct capital to our highest-value opportunities, we believe our North Sea business will be better positioned as part of another company," O'Neill said in a statement.

ExxonMobil, Chevron, ConocoPhillips, Shell, TotalEnergies and Eni have all sold, merged or otherwise reduced their operations in the ageing basin in recent years as production there falls. Smaller players and private equity-backed firms have been the buyers.

BP, formerly known ⁠as British ​Petroleum, has worked in the North Sea ⁠for more than six decades and operates five major production hubs in the region, including the Clair oilfield, the largest on the UK continental shelf. BP generated about 5% of its ⁠oil and gas output from the British North Sea last year, around 117,000 barrels out of a total of 2.3 million barrels of oil equivalent per day.

As opposed ​to the other major North Sea oil and gas producer Norway, Britain's tax regime on the industry in recent years has been marked ⁠by successive changes, decried by oil and gas companies for deterring investment. Burnham's Labour Party has already softened its election pledge to stop handing out new oil and gas licences and Energy Minister Miatta ⁠Fahnbulleh ​said she was in close contact with BP over its sale plan.

BP employs 1,100 workers in its North Sea business out of a total of around 14,000 employees in Britain, the London-headquartered company said. Overall output in the ageing oil and gas basin has plummeted to around 1 million boed ⁠last year from 4.5 million boed at the turn of the millennium.

BPhas stepped upits efforts to reduce debt, boost profit and refocus on its oil ⁠and gas businesses after scaling back ⁠its investment in renewable energy. Since O'Neill took over in April, BP has reorganised into two business segments — upstream and downstream — from three, a change that took effect this month.

An internal email seen by Reuters on Thursday also ‌disclosed BP's plans to reduce ‌its workforce by 700.