BP to sell North Sea oil and gas business

British oil and gas giant BP said on Friday that it had launched a process to market its North Sea business for a potential sale, as it looks to focus on its “highest-value opportunities”.

Its North Sea portfolio off the UK coast comprises five production hubs and employs about 1,100 people, BP added in a statement.

“The UK has been our home for more than 100 years and will continue to play an important role in our future. We’re proud of the jobs we create, the contribution we make to the UK economy, and the work we do to keep energy flowing every day,” BP chief executive Meg O'Neill said in the statement.

She added: “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. It has world-class people, resilient assets and a proud heritage, and it is precisely these qualities that can attract an owner ready to back its next chapter."

O'Neill said BP would seek a deal that recognised the business’s “people, assets and heritage”.

The announcement came a day after new UK Prime Minister Andy Burnham signalled that he could take a more flexible approach to North Sea oil and gas production, amid concerns about the UK's energy security and volatile global energy markets.

US President Donald Trump has repeatedly called on Britain to ramp up oil and gas production in the North Sea. Burnham said on Thursday that he intended to take “a pragmatic approach” to developing and using the region’s resources.

BP said it would continue to focus on operating the business safely and reliably throughout the sale process.

Why North Sea production is losing its appeal

BP's North Sea business currently employs approximately 1,100 workers, and the company has operated in the region for more than 60 years. In 2025, the business produced around 117,000 barrels of oil equivalent a day, accounting for approximately 5% of BP’s global oil and gas output.

However, the ageing basin has steadily lost some of its appeal in recent years as production has declined and the UK’s frequently changing tax regime has increased the burden on producers.

However, the basin has steadily lost some of its appeal in recent years due to declining production, higher windfall taxes and the previous Labour government’s decision not to issue new licences to explore new oil and gas fields.

Oil and gas companies have also criticised the windfall tax and broader policy uncertainty, arguing that they have discouraged investment.

The company is now choosing to focus more on its core oil and gas businesses, after scaling back its investments in renewable energy. The strategic reversal followed pressure from investors to improve returns and reduce debt.

Over the past year, BP has agreed to or completed several divestments. These include an agreement to sell a 65% controlling stake in Castrol, its lubricants business, to infrastructure investment firm Stonepeak. The deal is expected to close by the end of 2026, subject to regulatory approval.

BP's move follows similar retreats by several other global energy companies. ExxonMobil, Chevron and ConocoPhillips have sold North Sea assets, while Shell and Equinor have combined their offshore UK businesses in a joint venture. TotalEnergies has also reduced and reorganised parts of its regional portfolio as companies respond to declining production and seek more profitable projects elsewhere.