RUSSIA’S invasion of Ukraine has increased the appeal of gas assets in Europe significantly experts have said, amid reports that Italian giant Eni is in talks to acquire North Sea-focused Neptune Energy for around $5 billion (£4bn) to $6bn.

Reuters reported that Eni was in preliminary talks to buy private-equity backed Neptune, citing a source with knowledge of the matter.

The acquisition of Neptune would give Eni control over the giant Cygnus gas field off the UK and assets in countries such as Norway and Algeria.

Asked about the report, the Wood Mackenzie energy consultancy said it would have been surprised at the mooted deal 12 months ago noting that majors such as Eni are “leaning heavily into the energy transition”.

It added: “However, the Russian invasion of Ukraine has changed attitudes to energy security along with gas supply and prices. Eni has been working hard to replace Russian gas supply into Italy.”

Greg Aitken, director, M&A Research at Edinburgh-based Wood Mackenzie, noted that Neptune’s backers have been looking to exit for some time.

“A trade sale at the rumoured price would represent a clean break and successful exit,” he added.

Neptune and Eni declined to comment on the Reuters report regarding talks between the two firms.

Reuters said a banking source had confirmed that talks had taken place in recent weeks, but that the outcome was “far from guaranteed” as valuations differed.

Eni sold operations in the UK North Sea but has retained interests in Norway, in which Neptune has built a big business.

Neptune’s backers include Carlyle and China Investment Corporation.