TotalEnergies SE and NEO NEXT Energy Limited have agreed to merge their UK upstream operations, creating a new entity called NEO NEXT+. TotalEnergies will hold a 47.5% stake, while HitecVision will own 28.875% and Repsol UK will hold 23.625%. The combined company will bring together TotalEnergies’ North Sea assets—such as Elgin/Franklin, Culzean, Penguins, Mariner, Shearwater, Alwyn North and Dunbar—with NEO NEXT’s portfolio, positioning NEO NEXT+ as the largest independent oil and gas producer on the UK Continental Shelf.
The merger is expected to lift daily production to more than 250,000 barrels of oil equivalent by 2026, a figure that reflects the scale of the combined asset base and the high‑output potential of the North Sea fields. The transaction will also consolidate decommissioning liabilities, with TotalEnergies retaining up to $2.3 billion of legacy decommissioning costs, thereby improving the cash‑flow profile of the new entity.
Strategically, the deal aligns with TotalEnergies’ focus on low‑cost, low‑emission production and its broader UK upstream strategy. By combining operational expertise and scale, the new company aims to achieve cost efficiencies, enhance margin resilience in a volatile market, and accelerate cash‑flow generation from the continental shelf. The merger also signals TotalEnergies’ continued commitment to UK energy security and its intent to support the transition to a more sustainable energy mix.
Patrick Pouyanné, Chairman and CEO of TotalEnergies, said the transaction “demonstrates our long‑lasting commitment to the UK oil and gas sector and its energy security.” John Knight, Executive Chair of NEO NEXT, welcomed the partnership, noting that TotalEnergies’ operational capabilities will strengthen the company’s high‑pressure/high‑temperature gas production and overall portfolio resilience.
The combined entity will benefit from the complementary asset mix and shared technology platforms, positioning it to capture market share in a sector that is undergoing consolidation. The retention of decommissioning liabilities provides a clear financial baseline, while the projected production growth underscores the strategic value of scale in the North Sea’s challenging environment.
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