Repsol has completed the merger of its UK North Sea business with privately-owned Neo Energy to create one of the largest oil and gas producers in the region.
The new combined company Neo Next has been created from the merger of Neo and Repsol Resources UK, a deal that was announced in March this year.
Neo's owner HitecVision retains a 55% ownership in the new company with Repsol holding 45%.
The combined company will be one of the largest producers in the UK North Sea with a projected output of 130,000 barrels of oil equivalent per day in 2025, of which 68% is oil, according to Repsol.
Neo has assets in the Central North Sea, including interests in the Shearwater, Britannia Area, and Elgin Franklin hubs. Repsol's UK portfolio includes the Piper & Claymore fields.
John Knight, Executive Chair of Neo Next, commented: “The combined company has much more scale and diversity and opportunities for cost consolidation and portfolio high-grading giving resilience despite the tough conditions in the UK.
"The benefits of synergies from consolidation will create much stronger value creation, profit and cash flow yield for shareholders and more options for capital allocation decisions well into the next decade. But this company will also be very well positioned to choose both organic and inorganic growth.
"We will certainly look to be making more value accretive acquisitions. We have known Repsol E&P for many years and have the highest regard for them as a capable and reliable partner.”
Francisco Gea, Executive Managing Director of Exploration & Production at Repsol, commented: “This combination will create a jointly governed business which will call upon the key strengths of both shareholders. Repsol contributes operational capabilities on production, development, and decommissioning activities which will be combined with NEO Energy expertise on financial and commercial matters.
"We believe this combined business has many more opportunities for profitable growth in the basin and beyond.”