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November 29, 2021

NEO Energy agrees to buy JX Nippon Exploration and Production for $1.65bn

The transaction does not include JX UK’s stakes in the Andrew Area assets of the North Sea.

By Archana Rani

NEO Energy UK has agreed to purchase 100% stake in JX Nippon Exploration and Production (UK) (JX UK) from JX Nippon Oil & Gas Exploration (JX) for $1.65bn.

JX UK owns stakes in several producing fields in the North Sea.

JX UK’s subsidiary holds a 20% stake in the Mariner field and 18.01% in the TotalEnergies-operated Culzean field.

The Culzean field is located in the North Sea, 230km off the coast of Aberdeen.

Located 150km east of Shetland, the Mariner field is operated by Equinor with a stake of 65.11%.

The transaction, however, excludes JX UK’s interests in the Andrew Area of the North Sea.

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The deal is subject to regulatory consent and approval from the relevant authorities.

JX president and CEO Hiroshi Hosoi said: “This transaction is part of our ongoing global portfolio management strategy to strengthen our upstream portfolio by selling projects that are no longer critical to our business. In line with this strategy, we have decided to sell our UK business to NEO, which is an emerging upstream company.”

JX Nippon Oil & Gas Exploration is a core operating company in Japan’s ENEOS group.

The sale is part of the ENOES group’s ‘Long Term Vision for 2040’, which aims to achieve net-zero CO₂ emissions within the next 20 years.

Hosoi added: “In line with this Long Term Vision, we have been investing in various sustainable projects in Vietnam, Malaysia, Australia and the USA, including the Petra Nova CCUS project, one of the largest carbon capture projects in the USA.”

The deal follows reports earlier this year of JX Nippon exploring the sale of its oil and gas assets in the North Sea, with the Bank of America and Kirk Lovegrove appointed as advisers for the potential transaction.

In February, NEO Energy agreed to acquire ExxonMobil’s portfolio of non-operated oil and gas assets in the North Sea.

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