Oil & Gas

Shell and Equinor have announced a merger of their British offshore oil and gas assets, creating an equal joint venture. The new entity, which will be based in Aberdeen, Scotland, is set to produce more than 140,000 barrels of oil equivalent per day (boed), with the deal expected to be finalized by the end of 2025. The venture aims to extend the life of key North Sea oil and gas fields, offering a long-term, sustainable future for both individual platforms and the broader energy sector in the UK.

This merger will make the joint venture the largest independent producer in the British North Sea, although there are no plans for an initial public offering (IPO). Shell’s Upstream Director, Zoe Yujnovich, clarified that the new company will not pursue public listing. The British North Sea, which saw its heyday in the 1970s, has been in decline for years, with production dropping from a peak of 4.4 million boed at the turn of the millennium to just around 1.3 million boed today.

The new venture will incorporate significant assets from both companies. Equinor will contribute its stakes in major fields such as Mariner, Rosebank, and Buzzard, while Shell will bring in its holdings in Shearwater, Penguins, Gannet, Nelson, and others. Additionally, a number of exploration licenses will be included in the merger. Both companies are already developing major projects in the region, with Equinor focusing on the Rosebank oilfield and Shell working on the Jackdaw gas field.

Despite the joint venture, both Shell and Equinor will retain control over specific assets. Equinor will keep its cross-border interests in the Utgard, Barnacle, and Statfjord fields, as well as its offshore wind projects, including the Sheringham Shoal and Dogger Bank. Shell, meanwhile, will maintain its stake in the Fife NGL plant and other strategic infrastructure, including the Acorn carbon capture and storage project in Scotland. This collaboration comes at a time when the North Sea is facing increasing pressures from economic challenges, including a windfall tax imposed by the UK government in response to rising energy prices.