Eni completes $4.9bn acquisition of Neptune Energy

Italian oil giant Eni (BIT: ENI) has completed its multibillion-dollar takeover of North Sea operator Neptune Energy.

The firm’s $4.9bn acquisition plan was unveiled in June, following months of speculation as Neptune’s private equity owners make an exit.

Eni has acquired the firm’s entire operation, save for Norway – which is going to Var Energi (itself part owned by Eni) through a separate deal – and the business in Germany, which has had its own carve-out.

The Italian major has a limited operation in the UK meaning there is no expected impact on the workforce at Neptune, covering around 200 people between Aberdeen and London.

However, the future of the top leadership team, reported to own 1% of the business and due for a whopping payday, led by executive chairman Sam Laidlaw, is unclear.

© Supplied by Neptune Energy

Eni said in June that it was taking on a “world class portfolio” covering Western Europe, North Africa, Indonesia and Australia.

In the UK, Eni is acquiring the Cygnus gas field, the flagship asset of Neptune Energy and one of the country’s most prolific gas fields.

Other notable assets include the recent Seagull tie-back to BP’s ETAP hub.

Prior to the deal, Neptune Energy was owned by China Investment Corporation, funds advised by Carlyle Group and CVC Capital Partners, and some management owners.

CCS

Eni is also gaining access to Neptune Energy’s recently-awarded carbon capture and storage (CCS) sites, having won a trio of awards during 2023’s licensing round.

CCS is a burgeoning area of interest for the Milan-headquartered firm, which runs the HyNet development in North-west England.

Eni itself won a licence award during last year’s CCS round for its Hewett gas field in the southern North Sea.

Strategic deal for Eni

© Bloomberg

Announcing the deal closure today, Eni pointed to assets it is acquiring internationally.

“The acquisition is strategic in terms of increased gas production in North Africa, where Eni consolidates its position as the leading international energy company, and in Northern Europe, where the transaction opens up new CCS opportunities.

“Eni regards CCS as a key lever in its decarbonization strategy and there are further possible synergies with the projects Neptune is pursuing in Norway and the Netherlands.”

Norway

Var Energi is acquiring stakes in 12 producing assets, three of which will be as operator.

The deal adds 67,000 barrels of daily production, and 265m to its 2P reserves.

Neptune Norway will operate as a fully-owned subsidiary of Var Energi and change its name to Var Energi Norge.

CEO Nick Walker said: “Var Energi is one of the fastest growing E&P companies in the world and is on track to nearly double production by end-2025. The acquisition of Neptune Norway is an important step to this end. Neptune Norway’s complementary assets and highly skilled organisation are a perfect fit to Vår Energi.

“We will work as one strong team, a company committed to delivering high value barrels from one of the most attractive oil and gas regions in the world with low cost and low emissions. The transaction is cash generative from day one supporting attractive and predictable dividends going forward.”