BP Puts U.K. North Sea Business Up for Sale — 2nd Update

By Adam Whittaker

British energy major BP said it is putting its U.K. North Sea business up for sale, paving the way to end oil production in its home country after more than half a century.

BP said Friday that it would market the business to potential buyers as it refocuses spending on higher-returning projects elsewhere. Earlier this year, the company held talks with Ithaca Energy on a potential sale but a deal fell through.

The U.K. North Sea is a mature basin, meaning much of the easy-to-access oil has already been tapped. International energy majors have been scaling back their exposure as independent operators stepped in and have consolidated assets. Higher taxes on profits have also hit investment and changed the calculus for energy companies.

The sale process comes as BP reviews its portfolio of assets in a strategic shake-up designed to boost profits and shareholder returns. The company is targeting $20 billion in asset sales by the end of 2027 in a bid to cut net debt.

BP's share price and profitability have fallen behind peers in recent years, and the company is attempting to catch up by spending more on its core oil and gas business. Activist investor Elliott Management took a stake in the company last year and pushed for changes.

The increased spending on fossil fuels coincides with new Chief Executive Officer Meg O'Neill's efforts to bring a stricter approach to the group's investments.

O'Neill said BP is directing spending to its highest-value opportunities and that the North Sea business might be better positioned as part of another company.

The assets BP is putting up for sale include five production hubs across the central North Sea and west of the Shetland Islands. BP's North Sea business employs around 1,100 people.

BP received its first license to explore the North Sea in 1964 and began production 11 years later. While the company has its headquarters in the U.K., its origins stem from the Middle East, where its founder William Knox D'Arcy secured a concession to begin drilling for oil in 1902.

While BP's North Sea assets hold historic and national significance, they aren't of great importance to a modern BP, which has assets around the world, including significant holdings in the U.S. and the Gulf of Mexico.

BP's North Sea production averaged around 117,000 barrels of oil equivalent a day in 2025.

Industry groups, some labor unions and President Trump have called on the U.K. government to relax its restrictions on new oil and gas projects in the North Sea.

Trump's "drill, baby, drill" mantra has differed from the approach of the U.K.'s governing Labour Party, which said in its 2024 election manifesto that it wouldn't issue new licenses to drill for oil and gas. New Prime Minister Andy Burnham, who is less than two weeks into the job, recently told Trump that he would take a "pragmatic" approach to new drilling.

The U.K. government is currently deciding whether to proceed with two major North Sea oil and gas projects, called Jackdaw and Rosebank, which have been entangled in legal disputes.

Write to Adam Whittaker at adam.whittaker@wsj.com

(END) Dow Jones Newswires

July 31, 2026 04:39 ET (08:39 GMT)