BP has announced the sale of its global petrochemicals business to INEOS for $5 billion as part of BP’s strategic reinvention, according to a press release.

The agreed sale represents the next strategic step in reinventing BP, and will further strengthen BP’s balance sheet and help deliver its target for agreed divestments a year earlier than originally scheduled.

The deal is structured so that INEOS will pay a deposit of $400 million and will then pay a further $3.6 billion on completion of the deal. Subsequently, a further $1 billion will be deferred and paid in three separate installments of $100 million in March, April and May 2021 with the remaining $700 million payable by the end of June 2021. 

BP’s petrochemicals business is focused on two main businesses; aromatics and acetyls. In total, the businesses have interests in 14 manufacturing plants in Asia, Europe and the US and in 2019 produced 9.7 million tonnes of petrochemicals.

Bernard Looney, BP CEO said: “This is another significant step as we steadily work to reinvent BP. These businesses are leaders in their sectors, with world-class technologies, plants and people.”

This agreement means that BP has now agreed $15 billion of divestments and other disposals through 2019 and 2020 to date, an amount originally expected to be reached by mid-2021.