TotalEnergies agrees North Sea merger with Scotland's Neo Next Energy

TotalEnergies SE on Monday said it had signed an agreement to merge its upstream business with Aberdeen, Scotland-based Neo Next Energy Ltd to create the UK's "largest independent oil and gas producer".

The Paris-based fuel major will hold a 47.5% stake in the new company, dubbed Neo Next+. Norweigan private equity firm HitecVision will own 28.875%, while Spanish energy company Repsol SA takes just under 23.625%.

Financial details of the deal were not disclosed.

The enlarged firm will include "NEO Energy's and Repsol UK's interests in the Elgin/Franklin complex and the Penguins, Mariner, Shearwater and Culzean fields," TotalEnergies said. These will be combined with the French firm's assets in the Elgin/Franklin complex and the Alwyn North, Dunbar and Culzean fields.

Neo Next+ will target around 250,000 barrels of oil equivalent in 2026, TotalEnergies added.

"This transaction demonstrates the long-lasting commitment of TotalEnergies towards the UK oil and gas sector and its energy security. As the new largest shareholder of NEO NEXT+, we are excited to bring along our recognized track record as a leading operator in the UK North Sea," commented TotalEnergies Chief Executive Patrick Pouyanne.

He stressed that the firm's focus on low-cost production "will enhance the cash flow generation" of Neo Next+ as soon as the merger closes. Completion is expected in the first half of 2026.