Eni to farm down Congo project; Mozambique stake sale talks underway – exec

07 Nov 16 – Eni [NYSE:E], the Italian oil and gas major, is actively looking to farm down its 65% stake in the Marine XII block in the Republic of Congo, Chief Exploration Officer Luca Bertelli told Mergermarket.

The company is also in talks to farm out its Coral South FLNG project in Mozambique. He did not specify the stake size Eni is looking to sell, but noted that the company is looking for a new partner to further develop the block. The timeline by which it wants to complete the stake sale has not been determined.

The other partners for Marine XII are New Age Exploration, with a 25% stake; and Congolese government company Societé Nationale des Pétroles du Congo (SNPC), with 10%. Eni is the operator.

This news service reported last month that New Age, the 2017 IPO candidate, might benefit from further developing several projects before pursuing the listing, including increasing capital expenditure for its project in Congo.

Eni estimates the resources in the pre-salt Marine XII block to be 5.8bn barrels of oil equivalent (bboe), according to the company website. 

Marine XII’s partners began producing at the Nene Marine prospect on the block in December 2015. Nene Marine’s production rate stands at about 15,000 boe a day, the company said.

Bertelli said talks with potential buyers for a stake in Eni’s Coral South FLNG project in Mozambique’s Block 4 are taking place and progressing well.

Eni is the operator of the project with a 50% indirect interest, owned through Eni East Africa (EEA), which holds a 70% stake in Area 4. The other concessionaires are Galp Energia, KOGAS and Empresa Nacional de Hidrocarbonetos (ENH), with a 10% stake each. China’s CNPC owns a 20% indirect interest in Area 4 through Eni East Africa. Eni sold a 20% stake in the gas block, Area 4, to  CNPC for USD 4.4bn, but this was in March 2013, when oil prices were high.

Market reports in August said ExxonMobil [NYSE:XOM] was close to a deal to farm into the Block 4 area but Coral South will not be part of the transaction.

Eni has a market capitalisation of USD 49.30bn.

by Katie McQue