Ithaca Energy, a leading independent oil and gas operator in the UK North Sea, announced a significant step towards a transformative combination with Eni S.p.A.’s UK upstream assets, signaling a major move in the energy sector. This potential combination, excluding Eni’s CCUS and Irish sea assets but including the recently acquired Neptune Energy assets, is set under an exclusivity agreement, granting Ithaca Energy a four-week period of exclusivity to advance towards the Potential Combination.

The envisaged combination underscores a strategic alignment between Ithaca Energy’s Buy, Build, and Boost strategy and Eni’s diversified asset base, including major hubs like Elgin Franklin, J-Area, Cygnus, and Seagull. Notably, Ithaca Energy is no stranger to collaboration with Eni, already being a partner in the Elgin Franklin and Jade fields.

Key aspects of this potential combination include Eni’s contribution of its UK business in exchange for new Ithaca Energy shares, resulting in Eni holding an estimated 38% to 39% of Ithaca’s enlarged issued share capital. This move is poised to significantly scale and diversify Ithaca Energy’s operations, potentially growing pro forma production to above 100 kboe/d and marking Ithaca Energy as the second-largest independent operator in the UK Continental Shelf by production.

This strategic partnership is not just about scale; it’s about sustainability and innovation, with both companies leveraging their combined expertise to enhance their status in the energy sector. The combination aims to boost near-term cash flows and unlock growth from Ithaca Energy’s development projects while supporting shareholder returns. Moreover, this partnership with Eni, set to become a major shareholder, envisages Ithaca having access to Eni’s leading technical expertise to foster future growth.

However, it’s important to note that while discussions are advanced, the completion of this Potential Combination is subject to shareholder approval and other regulatory considerations. The partnership is expected to require a mandatory offer under the UK’s Takeover Code, though a dispensation has been granted due to Delek’s continued majority voting rights post-completion.

This strategic alliance between Ithaca Energy and Eni represents a forward-thinking approach to addressing the complex challenges and opportunities within the energy sector. By combining Ithaca’s agile and innovative operations with Eni’s extensive resources and technical prowess, this partnership aims to accelerate the transition towards more sustainable and efficient energy production practices. It signifies a crucial step towards redefining the UK North Sea’s role in the global energy landscape, potentially setting a benchmark for industry-wide collaborations aimed at enhancing sustainability and operational efficiency.

  Energy Innovation, energy sector, Eni S.p.A., Ithaca Energy, Oil and Gas, sustainable practices, UK North Sea