Essar Oil UK, a part of the Essar Group, is acquiring stakes in multiple assets from British energy giant BP to fuel its growth ambitions in the country.
Essar said in a statement that it has agreed to pick up a 11.15% stake in the United Kingdom Oil Pipeline (UKOP), a share of the contractual joint venture with Shell that runs the Kingsbury Terminal, and a 100% stake in the Northampton Terminal.
BP will hold a 22% stake in UKOP following the acquisition by Essar.
Essar Oil UK is acquiring the assets through its wholly-owned subsidiaries Essar Midlands Ltd and InfraNorth Ltd.
The value of the deal has not been disclosed.
“The acquisition of these BP assets further demonstrates the company’s ongoing commitment to investing in and growing their businesses within the United Kingdom,” said S Thangapandian, chief executive officer of Essar Oil UK.
“Essar currently supplies over 16% of the UK’s road transport fuel demand and this agreement will enable us to improve our competitiveness,” he added.
Essar further said that it will continue to look for opportunities to expand inorganically, provided the acquisitions are long-term value-accretive and complements Essar Oil UK’s growth plans.
With the latest deals, Essar said it has so far invested nearly $1 billion in the UK since acquiring Stanlow Refinery in 2011 from Royal Dutch Shell.
Essar Oil UK owns and operates Stanlow Refinery which is situated near Liverpool. The refinery produces 16% of the UK’s road transport fuels, including 3 billion litres of petrol, 4.4 billion litres of diesel and 2.1 billion litres of jet fuel per year.
Essar also has a downstream presence with 67 Essar-branded fuel retail outlets operational across England and Wales. It plans to grow its network to 400 retail outlets over the next five years, according to the statement.