TotalEnergies Creates Largest North Sea Player in U.K.

Written by Martin Lynch, European News Editor for IIR News (Galway, Ireland)

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Summary

French energy major TotalEnergies SE has agreed to merge its U.K. North Sea oil and gas business with Neo Next Energy to create the largest operator in the region from next year. It comes just weeks after rivals Shell plc and Equinor launched Adura, the new company created from their merged U.K. North Sea offshore oil and gas assets.

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New U.K. North Sea Player

French energy major TotalEnergies SE (Courbevoie, France) has agreed to merge its U.K. North Sea upstream business with Neo Next Energy (Aberdeen, Scotland).

The expanded company, Neo Next+ will, according to the partners, be the largest independent oil and gas producer in the U.K. with a production of more than 250,000 barrels of oil equivalent (BOE/d) per day in 2026. The claim comes just weeks after rivals Shell plc (London, England) and Equinor (Stavanger, Norway) merged their U.K. North Sea offshore oil and gas assets into a new entity called Adura (Aberdeen, U.K.), and also claimed that it would be the largest producer in the U.K. North Sea in 2026, with a production capacity of 140,000 BOE/d. For additional information, see December 9, 2025, article - Shell, Equinor Launch Adura as Biggest Player in U.K. North Sea.

Who is Neo Next?

Neo Next is the company created earlier this year by the merged operations of NEO Energy Group Ltd. and the U.K. business of Repsol SA (Madrid, Spain). It is 55% owned by European energy investor HitecVision and 45% by Repsol's E&P business unit. The new deal with TotalEnergies will see that company become Neo Next+ with the key shareholders being TotalEnergies (47.5%), HitecVision (28.875%) and Repsol UK (23.625%). TotalEnergies U.K. will retain up to US$2.3 billion of decommissioning liabilities related to its legacy assets, supporting the combined entity's cash flows.

Combined Assets

The new entity will have a large portfolio of assets in the U.K. Continental Shelf (UKCS), benefitting from NEO Energy's and Repsol U.K.'s minority interests in the Elgin/Franklin complex, two high pressure/high temperature gas and condensate fields, which started production in 2001. They also bring the Penguins, Mariner, Shearwater and Culzean fields. TotalEnergies upstream operations include the majority stake in the Elgin/Franklin complex, and the Alwyn North, Dunbar and Culzean fields. 

"This transaction demonstrates the long-lasting commitment of TotalEnergies towards the U.K. oil and gas sector and its energy security," said Patrick Pouyanné, chairman and chief executive officer of TotalEnergies. "As the new largest shareholder of NEO NEXT+, we are excited to bring along our recognized track record as a leading operator in the U.K. North Sea, where we have been present for more than 60 years."

The Decline of the U.K. North Sea Oil & Gas

The U.K.'s North Sea assets have been on the decline for decades, with more than 70,000 jobs shed by the sector in the last decade. It now employs roughly 120,000 people directly and indirectly.

Mergers over the past year between the remaining players have become more commonplace in an effort to achieve greater productivity while reducing production costs, their tax burden and project risk.

U.K. crude production has dropped more than 50% in the past five years, from roughly 1.1 million barrels a day in 2020 to less than 500,000 barrels per day by September 2025. New exploration activity is very low. The current U.K. government is against allowing any new oil and gas projects but recently announced that it will allow some relaxation of restrictions that will allow for some new drilling but only if they can be "tied back" to existing fields and infrastructure.

In November, Industrial Info reported that leading U.K. energy services company Petrofac (London) entered administration, putting up to 2,000 Scottish jobs at risk. Around 1,200 of these are based offshore on rigs owned by oil and gas companies, with another 800 onshore in training and operational roles. For additional information, see November 5, 2025, article - North Sea Services Major Petrofac Enters Administration.

Key Takeaways

• French energy major TotalEnergies has agreed to merge its U.K. North Sea oil and gas business with Neo Next Energy to create the largest operator in the region.
• The new company, Neo Next+, will be the largest independent oil and gas producer in the U.K. with a production over 250,000 barrels of oil equivalent (BOE) per day in 2026.
• Rivals Shell plc (London, England) and Equinor (Stavanger, Norway) did something similar in recent weeks with the launch of a new merged company, Adura (Aberdeen, U.K.). 

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