By Pierre Bertrand


Ithaca Energy said it reached an agreement with Eni on a proposal to merge with most of the Italian oil and gas company's upstream assets in the U.K. for around 754 million pounds ($931.1 million).

In exchange, U.K. North Sea oil-and-gas operator Ithaca would issue 635 million shares to Eni's subsidiary in the region, Eni UK Limited.

Eni UK will be issued ordinary shares representing 38.5% of the enlarged issued share capital of Ithaca Energy, Ithaca said.

The deal excludes Eni UK's East Irish Sea assets and its carbon capture, utilization and storage activities, Ithaca said, adding that it would have the potential to organically grow production to 150,000 barrels of oil equivalent per day by the early 2030s.

Ithaca said it expected to produce 80,000 to 87,000 barrels of oil equivalent per day this year as a result of the combination.

The deal is expected to close in the third quarter of the year, Ithaca said.

"We have moved quickly after the acquisition by Eni of Neptune Energy to transform our competitive position in the UK and we see the opportunity for Eni and Ithaca to realise material long-term value in helping to address the key challenges of security, affordability and sustainability of energy supply," Eni Chief Executive Claudio Descalzi said in a statement.


Write to Pierre Bertrand at pierre.bertrand@wsj.com


(END) Dow Jones Newswires

04-23-24 1345ET