BP in $2bn Saudi investment deal

BP says the agreement ensures long-term growth opportunities

Oil giant BP has announced plans to invest up to $2bn (£1.1bn) in Saudi Arabia's petrochemicals industry.

The UK company said its subsidiary Innovene has signed a memorandum of understanding with Saudi development firm Delta International.

"The memorandum marks the beginning of detailed negotiations between Innovene and Delta," BP said.

The company said the investment would form a "platform for long-term growth opportunities" in Saudi Arabia.

BP reported a 29% jump in first-quarter net profits in April, boosted by a sharp increase in world oil prices.

The company has said that Innovene could be the subject of a flotation later in 2005.