TotalEnergies has reached an agreement to merge its UK upstream operations with Neo Next Energy, the venture owned by Repsol and HitecVision, in a move that will establish one of the most dominant players in the UK North Sea.

The enlarged company, to be known as Neo Next+, is projected to deliver more than 250,000 barrels of oil equivalent per day in 2026. TotalEnergies will hold a 47.5% stake, while HitecVision and Repsol will own 28.875% and 23.625% respectively. The deal is expected to be completed in the first half of 2026.

Although financial terms were not disclosed, TotalEnergies will retain up to $2.3 billion in decommissioning obligations linked to older UK assets.

TotalEnergies chief executive Patrick Pouyanné said the merger aligns with the company’s long-term commitment to the UK North Sea, adding that its focus on low-cost and low-emission operations will bolster the efficiency of the combined portfolio.

Repsol CEO Josu Jon Imaz said the partnership strengthens Neo Next’s strategy by creating a broader and more balanced set of assets with increased operational control. Neo Next’s executive chair John Knight added that TotalEnergies brings deep technical experience, particularly in complex offshore and high-pressure gas developments.

The French major has been streamlining its UK presence in recent years, withdrawing from the West of Shetlands in 2024 and beginning decommissioning work on the Gryphon Alpha FPSO after production ended that year. Its remaining UK portfolio includes interests in the Alwyn North and Dunbar fields, the Elgin-Franklin complex, and the Culzean and Isabella projects.