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The company bp has finalized a definitive agreement to sell its Gelsenkirchen refinery to the Klesch Group, an independent operator with extensive experience across Europe. This decision is not isolated; it is part of a plan to streamline the asset portfolio and focus resources on higher-margin integrated businesses.
The transfer of the Gelsenkirchen refinery
Following completion of this sale, the organization has raised its financial targets. The new structural cost-reduction goal is now set at between $6.5 billion and $7.5 billion by the end of 2027. This figure reflects direct savings of approximately $1 billion in operating expenses previously tied to the Gelsenkirchen plant. Likewise, this move represents significant progress toward achieving a 30% reduction in the cost base compared with fiscal year 2023.
The transaction involves the transfer of physical infrastructure, as well as a deep clean-up of bp’s balance sheet. The agreement includes the transfer of obligations such as provisions, pensions, and other short-term liabilities associated with the German site. Through this divestment, the company aims to reduce its refining cash flow breakeven by $3 per barrel, ensuring a much more resilient structure against fluctuations in the global market.
Meanwhile, Klesch Group takes control of a facility that processes around 12 million tonnes of crude annually. The acquisition includes the Bottrop tank farm and the subsidiary DHC Solvent Chemie GmbH. Klesch’s prior experience with refineries such as Heide and Kalundborg suggests stable operational continuity for the complex’s 1,800 employees. To secure regional supply, bp has signed purchase and sale agreements for aviation fuels and on-road products produced at the same plant.
Finally, the transfer process is expected to be completed in the second half of 2026, once the relevant regulatory approvals are obtained. Gelsenkirchen’s assets and liabilities will be classified as held for sale from the first quarter of this year. This action underscores management’s determination to generate sustained value for shareholders by removing unnecessary operational complexity and focusing on the resilience of the specialized refining business the brand will retain globally.
Source and photo: bp