Operator Apache is selling stakes in key infrastructure in the latest example of independent investment in “midstream” oil and gas operations in the UK North Sea.
The US firm is offloading both its 30.28% share in the Scottish Area Gas Evacuation (Sage) system and a 60.56% interest in the Beryl pipeline to Ancala Midstream Acquisitions (AMA), which is backed by funds managed by Ancala Partners.
Aberdeen-based energy service company Wood Group is already lined up as AMA’s operating partner, subject to regulatory and third party approvals.
About 110 people – 60 Apache employees and 50 contractors – currently working at the Sage terminal at St Fergus, near Peterhead, will transfer to Wood Group.
The value of the deal, which is expected to complete during the first half of next year and become part of a growing trend of infrastructure sales to private-equity and specialist funds, was not disclosed.
Houston-based Apache said: “Ancala, in partnership with Wood Group, possesses the capabilities to operate Sage in a safe, reliable, and efficient manner.
“Apache recognises and sincerely appreciates the dedication and hard work of its Sage employees who delivered a safe efficient and reliable operation.
“Their continued contributions will be key to the success of the future of Apache’s Beryl area fields.”
Ancala Partners makes long term investments in infrastructure assets in the UK on behalf of pension plans.
The AMA management team will be led by Jim Halliday, who has been appointed chief executive and has more than 35 years’ industry experience from senior positions at BP.
Mr Halliday said: “Our aim in making this investment is to maximise throughput for all producers, extend the life of the system, connect new fields and support efforts to maximise economic recovery in the North Sea for many years to come.
“Our priority through the transition period will be the continued safe operation of the plant and pipeline, regular and transparent engagement with all stakeholders and an efficient hand-over of operations from Apache.”
The Sage system transports gas through a 200-mile pipeline from fields including Brae, Alvheim, Maclure, Scott, Ettrick, Golden Eagle, Devenick and Rochelle to the terminal at St Fergus, where it is processed on behalf of producers.
Last year, private-equity firm Antin Infrastructure Partners raised its stake in the Central Area Transmission System, serving 34 producing North Sea fields and transporting about 8% of the UK’s gas demand, to 99%.
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