Freshfields Bruckhaus Deringer has advised Companía Logística de Hidrocarburos CLH, S.A. on its acquisition of the Government Pipeline and Storage System, the largest oil distribution network in the UK, from the UK Ministry of Defence for £82 million.
The transaction is expected to complete on 30 April 2015.

The GPSS is a fuel storage and distribution network with over 2,000km of pipelines supplying aviation fuel to UK military bases and the UK civil aviation sector, notably Heathrow, Gatwick, Stansted and Manchester airports. The GPSS is currently operated by the Oil and Pipelines Agency on behalf of the MOD.

As part of the transaction, the MOD and CLH have agreed an enduring contract for the provision of aviation fuel through GPSS’s network to UK military bases. The MOD’s share over the first 10 years of the contract will cost some £237 million.

CLH is the leading company in Spain for oil transportation and storage, serving both civil and military customers. It operates one of the largest and most efficient integrated oil storage and transportation networks in the world, with more than 4,000km of oil pipelines and a storage capacity of 7.9 million cubic metres available to all oil operators in Spain.

The GPSS acquisition will increase CLH’s current oil pipeline network by 50% and continues CLH’s internationalisation strategy started in 2014 with the creation of a joint venture in Oman.

The Freshfields team was led by corporate partners Martin Nelson-Jones and Piers Prichard Jones. Finance partner Nicholas Bliss advised on the military arrangements and other UK public sector aspects, and finance partner Alex Mitchell led on acquisition financing. The London team was supported by Corporate partner Armando Albarran in the Madrid office.

Martin Nelson-Jones, co-head of Freshfields’ Infrastructure and Transport Group, said 'We are delighted to have assisted CLH on this complex and strategically significant acquisition which brings to the UK market CLH’s considerable expertise as a pipeline operator.'