������̳

A watchdog has raised concerns over the planned merger of two major drilling firms operating in the UK North Sea.

The UK's Competition and Markets Authority (CMA) could increase operating costs for oil and gas producers.

It had opened an investigation into in February.

Noble and Maersk Drilling are both offshore drilling contractors for the oil and gas industry.

Following its initial investigation, the CMA found the deal raised competition concerns in the supply of jack-up rigs, commonly used for offshore drilling by UK customers in the North Sea.

In a statement, it said the merging business were two of the four main suppliers in the Northwest Europe market and had frequently competed against each other for contracts in the past.

'Critical services'

Colin Raftery, senior director of mergers at the CMA, said: "Offshore drilling services are critical for oil and gas producers. Our investigation showed that Noble and Maersk have competed closely in the past and face only limited competition.

"We're therefore concerned that the loss of competition that this deal would bring about could result in higher prices or lower quality services, increasing operating costs for oil and gas producers in the UK North Sea."

A Maersk Drilling spokesman said: "We take note of the initial findings of the CMA relating to the proposed merger of Noble and Maersk Drilling where the authority raises competition concerns in the Northwest Europe jack-up market, as predicted in the merger process update we disclosed to the market last week.

"We still expect to be able to close the transaction in mid-2022, subject to conditional phase one antitrust clearance being obtained from the CMA."

Noble and Maersk Drilling have been given five working days to respond to the CMA's concerns.