BP puts North Sea oil and gas business up for sale as CEO Meg O'Neill accelerates portfolio overhaul

The sale announcement

BP on Friday launched a formal process to sell its North Sea oil and gas business, ending more than six decades of production in the basin. The business includes five production hubs, two in the central North Sea (Andrew and ETAP) and three west of Shetland (Glen Lyon, Clair and Clair Ridge), that together produced 117,000 barrels of oil equivalent per day in 2025, about 5% of BP's total output. Around 1,100 employees work in the unit, out of BP's roughly 14,000-strong UK workforce. CEO Meg O'Neill said the North Sea remains integral to the UK's energy system but that the business would be "better positioned as part of another company" as BP directs capital to higher-value opportunities. The sale could fetch around £2 billion, though earlier talks with Ithaca Energy collapsed.

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.

CEO's wider overhaul

O'Neill, who took over on 1 April, has moved swiftly to reshape BP. The company has been split into two segments, upstream and downstream, from three, a change that took effect this month. An internal email seen by Reuters disclosed plans to cut 700 jobs. In May, BP abruptly removed chairman Albert Manifold, citing concerns about governance standards and conduct. The North Sea sale is the latest step in a strategy to reduce debt and simplify the group.

Political pressure and pragmatism

The sale comes a day after Prime Minister Andy Burnham said he would take a "pragmatic" approach to North Sea drilling, telling reporters that "we can't ignore" the resource when households are struggling. His comments followed claims by US President Donald Trump that Burnham had told him he was ready to "open up" the North Sea. Labour's 2024 manifesto pledged not to issue new exploration licences, putting the new government in a delicate position. Critics argue that North Sea output does little to lower household energy bills because oil and gas are traded globally, and that new drilling would undermine Britain's climate goals. Energy Secretary Miatta Fahnbulleh said she was in close contact with BP and that her priority was protecting workers and local communities during the sale process.

There is a resource there. When people are struggling, we can't ignore that.

Industry alarm

Business leaders in Aberdeen, the historic centre of North Sea extraction, reacted with dismay. Russell Borthwick, chief executive of Aberdeen and Grampian Chamber of Commerce, called the announcement a "defining moment" for the new prime minister and urged the government to scrap the energy profits levy and replace it with a stable, long-term fiscal regime. He said confidence in the UK continental shelf had been "badly shaken after years of policy uncertainty, punitive taxation and mixed messages". John Underhill, director of energy transition at Aberdeen University, described BP's decision as "the end of an era". Other oil majors have already exited: ConocoPhillips sold its British assets, and Shell has reduced its footprint.

Today's announcement from BP should be a defining moment for the new Prime Minister. How many more jobs need to be lost before the UK Government acts?

What happens next

BP said it would seek an owner ready to invest in the assets' next chapter. The sale process is expected to attract interest from private equity and smaller operators, though the political uncertainty around UK fiscal policy may weigh on valuations. The government faces pressure to clarify its long-term stance on North Sea licensing, balancing energy security, jobs and climate commitments.