BP has announced plans to sell part of its stake in the Sullom Voe oil terminal in a £68m deal.

The agreement with EnQuest also includes a 25% share in the BP-owned Magnus field and a number of pipelines.

EnQuest will take on 3% of BP's current 12% stake in Sullom Voe and take over the operation of the terminal, where oil is brought ashore from the North Sea.

STV News revealed last year that BP had scrapped plans for a £500m gas processing facility near the existing plant which would have created 330 jobs.

The British firm has also cut more than 20% of its North Sea workforce.

BP group chief executive Bob Dudley said: "EnQuest's experience of investing in and extending the life of mature assets in the North Sea make them a natural operator of Magnus and Sullom Voe in this later phase of their life.

"We believe this will enable them to prolong the life of the assets, benefiting the region and creating additional value for both EnQuest and BP shareholders."

The agreement includes a clause which would allow EnQuest to purchase BP's remaining stakes in Sullom Voe and the Magnus field for £240m.

About 120,000 people whose jobs were linked to the oil and gas industry in the UK are thought to have been made redundant since the slump began in early 2014.

Companies including BP, Shell and Wood Group have made significant cuts since the value of a barrel of oil plunged from a high of $110 in June 2014 to under $30.

The price now sits at around $53 but a lack of investment threatens the future of the North Sea.

Shetland Islands Council leader Gary Robinson said: "This is the end of an era for the oil and gas industry but it is also the beginning of a new era.

"The significance for Shetland cannot be underestimated. This is a positive opportunity for the future of Shetland and a big change for Shetland and for Sullom Voe Terminal.

"EnQuest are known for managing end of life assets and extending their life.

"They will have the opportunity to focus on Sullom Voe Terminal and attracting new business, particularly from the west of Shetland.

"The council and the wider Shetland Partnership will be working with them to realise that opportunity.

"We are now looking to EnQuest to develop the arrangements at Sullom Voe Terminal to provide a competitive environment for opportunities to the west of Shetland."