Eni International BV agreed to acquire Neptune Energy Group Ltd., with Vår Energi simultaneously signing an inter-conditional agreement to acquire Neptune Energy Norge AS for an aggregate enterprise value of $4.9 billion.
Neptune’s business in Germany is not part of the transactions and will continue to be owned and operated by the ultimate existing Neptune shareholders as a standalone group.
The Vår transaction will close immediately prior to the Eni transaction with the proceeds from the Norway sale remaining with the Neptune Global Business purchased by Eni. Vår is 63% owned by Eni.
Neptune global business
In the UK, in 2022, Neptune produced 15,000 boe/d, of which most is gas production from the operated Cygnus field. Neptune is currently developing the operated Seagull field which is due to come onstream in this year’s second half. In 2022, Eni produced 44,000 boe/d in the UK, mainly from the non-operated Elgin Franklin and J-Block.
In 2022 Neptune produced 18,000 boe/d from the Netherlands, mostly gas. Neptune is the largest producer in the Dutch North Sea and operates several offshore hubs which provide opportunity to efficiently add new reserves and production through infill drill and tiebacks.
Neptune operates Touat field in Algeria. Production is currently suspended but is expected to restart once upgrades to the processing infrastructure complete with plateau production over 70,000 boe/d. Neptune production from the Western Desert in Egypt in 2022 was 3,000 boe/d.
In 2022, Eni produced 95,000 boe/d in Algeria and 346,000 boe/d in Egypt.
Neptune production in Indonesia of over 20,000 boe/d came from the Eni-operated Jangkrik and Merakes fields, which supply gas to the Bontang LNG plant and domestic customers. Eni production in 2022 was 62,000 boe/d.
Neptune maintains an interest in the Petrel project in the Bonaparte basin, offshore Australia. Development options are currently being assessed, and optionality to leverage existing infrastructure including Eni-operated (100%) Blacktip field, which produces and processes gas offshore for delivery to shore.
In 2022 the Neptune’s Norway business accounted for 58,000 boe/d of low-cost and low-emission production, of which 57% was gas or LNG. Neptune’s principal assets in the country are Snøhvit, Njord, Gudrun, Fenja, Duva, Gjøa, and Fram, of which Fenja, Duva, and Gjøa are operated. In 2022, Neptune completed development activities on Njord and Fenja, with both expected to contribute to production growth this year.
Future growth is expected to be driven by short-cycle tie-back opportunities to existing infrastructure. In 2022, Vår produced 220,000 boe/d.
Completion of the acquisitions is conditional upon, among other things, the receipt of necessary regulatory and governmental clearances. The transactions are expected to close by the end of first-quarter 2024.