Repsol has been in discussions to merge its UK North Sea operations with NEO Energy in what could be another consolidation offshore the UK, where operators struggle with a high windfall tax. The Spanish energy major has been holding extensive talks with private equity-backed NEO Energy and could announce a deal in the coming weeks, anonymous industry sources told Reuters on Friday.
Repsol, for its part, holds interests in 48 fields in the UKCS, of which it operates 38, with 11 offshore installations – ten fixed and one floating – and two onshore terminals - at Flotta in Orkney and at Nigg in the Cromarty Firth. A Repsol-NEO deal, if it goes through, would follow the combination of substantially all of Eni’s UK upstream operations with Ithaca Energy in April.