Shell (LSE:SHEL) and Equinor (OSE:EQNR) have announced plans to combine their North Sea oil and gas assets to form a new company that will become one of the region’s largest producers. The joint venture will be based in Aberdeen.

The 50-50 partnership will incorporate Equinor’s interests in the Mariner, Rosebank and Buzzard fields, and Shell’s interests in the Shearwater, Penguin and Jackdaw fields. The combined company is expected to produce more than 140,000 barrels of oil equivalent per day by 2025.

The transaction is effective from January 1, 2025, is subject to regulatory approval, and is expected to close by the end of the year. The 1,300 UK oil and gas employees of Shell and Equinor will be transferred to the new entity.

Headquartered in London, Shell is one of the world’s largest energy companies, known for its large-scale oil and gas operations and growing investments in renewable energy.

Equinor (formerly known as Statoil) is a Norwegian national multinational energy company headquartered in Stavanger. Founded in 1972 as the Norwegian National Oil Company (Statoil), it was established to manage the country’s rapidly growing oil resources following important offshore discoveries in the late 1960s.

Strategic and economic rationale

The operation will allow Shell and Equinor to leverage financial synergies and offset losses in a difficult regulatory environment. Recent windfall taxes and declining North Sea production have accelerated consolidation efforts among energy giants. Analysts suggest the deal is consistent with similar cooperation in Norway and other mature basins.

Zoe Eujinovic, Shell’s integrated gas and upstream director, said: “This new business will play a key role in a balanced energy transition, providing heat and securing fuel supplies to millions of UK homes. Probably.”

Philippe Mathieu, Equinor’s Executive Vice President, International Exploration and Production, highlighted the benefits of combining expertise, saying: “This transaction will strengthen Equinor’s near-term cash flow and provide reliable energy to the UK. “It will ensure supply.”

Environmental groups including Greenpeace have raised concerns about projects such as Rosebank and Jackdaw because of their impact on emissions, but both companies are concerned that the project will help the UK in its transition to renewable energy. claims to support the energy needs of