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BP is looking to sell up to 49% of its U.S. natural gas pipeline network in a deal that could fetch up to $3 billion, Reuters reported on Friday, citing anonymous sources with knowledge of the plans.
The potential sale would be part of BP’s efforts to reduce its net debt, which has recently increased, according to some of Reuters’s sources.
BP Pipelines North America Inc. operates in 14 states and 136 counties in the Midwest and Northwest, with an ownership stake in approximately 1,500 miles of additional pipelines. BP’s North American pipeline business manages and maintains more than 3,200 miles of pipelines and transports 1.1 million barrels of crude oil, natural gas, and refined products every day, BP says.
BP is also reportedly considering a potential sale of a minority stake in its offshore wind business in a move to reduce spending on project developments in the sector. The UK-based supermajor, which is pivoting back to its core business of oil and gas to give higher returns to shareholders, has reportedly hired Bank of America to find minority partners for the offshore wind business, anonymous sources told Reuters in October.
A sale of a minority stake in BP’s natural gas pipeline network would continue the recent wave of mergers and acquisitions in the U.S. midstream.
Last month, pipeline owner and operator DT Midstream said it would buy three interstate natural gas pipeline systems from ONEOK for $1.2 billion in cash as the consolidation in the industry has extended to midstream operations.
Last year, ONEOK bought Magellan Midstream Partners, creating a combined U.S. oil and gas pipeline giant with a total enterprise value of $60 billion.
The midstream merger frenzy in North America continued into 2024, with gas station owner Sunoco LP announcing in January that it would buy pipeline and liquids terminal operator NuStar Energy in an all-equity transaction valued at around $7.3 billion, including debt.
