NEO NEXT, TotalEnergies and Repsol advance major UK North Sea consolidation with new merged operator

NEO NEXT Energy, the joint venture formed by HitecVision and Repsol, has agreed to merge its UK offshore oil and gas business with TotalEnergies’ UK operations, creating one of the largest upstream producers on the UK Continental Shelf. The combined company, to be known as NEO NEXT+, is expected to produce more than 250,000 barrels of oil equivalent per day in 2026, positioning it as the leading operator in the basin.

The agreement marks the latest round of corporate consolidation in the mature UK North Sea, where operators are focusing on scale, operational efficiency and low-emissions performance to extend asset life and compete through mid-century. Completion is expected in the first half of 2026, subject to government and regulatory approvals.

Under the terms of the deal, TotalEnergies UK will acquire a 47.5% ownership stake in NEO NEXT, joining HitecVision with 28.875% and Repsol with 23.625%. TotalEnergies will also retain up to $2.3 billion in decommissioning liabilities tied to its legacy portfolio, which the companies said will improve cash generation for the merged entity.

The transaction brings TotalEnergies’ high-quality operated assets into NEO NEXT’s platform, reinforcing the operator’s balance sheet and expanding its technical capabilities in high-pressure, high-temperature gas production and large-scale offshore project execution. The enlarged company will have a broader inventory of near-term development opportunities and a stronger position to pursue additional mergers and acquisitions.

“We are delighted to welcome TotalEnergies and their UK oil and gas business to become part of NEO NEXT,” said John Knight, executive chair of NEO NEXT and senior partner at HitecVision. He said the combined platform will continue to pursue the company’s “Resilience, Yield and Growth” strategy, which has already driven several acquisitions over the past year, including Gran Tierra North Sea, BP’s Culzean interest and the merger with Repsol UK announced in March.

“NEO NEXT+ intends to continue to play a leading role in ownership consolidation activity in the UK Continental Shelf for many years to come,” Knight said, noting the enlarged company will benefit from scale and expanded development optionality.

TotalEnergies Chairman and CEO Patrick Pouyanné said the deal demonstrates the company’s long-term commitment to the UK sector and enhances energy security by strengthening domestic production.

“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,” Pouyanné said. “TotalEnergies’ consistent focus on running low-cost and low-emissions operations will be instrumental in delivering economies of scale within the new portfolio and enhancing cash flow as soon as the transaction closes.”

Repsol CEO Josu Jon Imaz said the merger supports the JV’s strategy while allowing Repsol to sharpen its global upstream portfolio around higher-margin, higher-return assets.

“With complementary shareholder strengths and a broader, balanced portfolio under greater operational control, we will be well-positioned to compete and adapt in the UK North Sea,” Imaz said. “With this deal, we continue to optimize our global asset portfolio with a focus on high-margin projects to sustain business scale in the medium and long term and enhance shareholder value.”

NEO NEXT was formed with the ambition of becoming a top-tier UKCS operator with strong cash yield and long-term resilience. The combined NEO NEXT+ business is expected to provide greater optionality for capital allocation, improved operational efficiency across a larger asset base, and additional opportunities to extend field life through both development activity and further M&A.

More details on the structure and future plans of NEO NEXT+ are expected at financial close in 2026.