Eni Expects Exxon Sale, Zohr's Launch, in 4Q
Eni expects to complete its divestment to Exxon of a 25% stake in Mozambique Area 4 by the end of this year, the Italian firm said in 3Q results released October 27. The $2.8bn deal, announced in March, will bring the US supermajor into the Coral FLNG and planned larger Mamba LNG export projects.
Eni also resumed the Bahr Essalam phase 2 development offshore Libya, with first gas on schedule for 2018. Start-up of the giant Zohr gasfield offshore Egypt also remains on target, so by end-2017, the company added.
Net profits were €344mn in 3Q 2017, reversing a net loss of €562mn a year earlier; in the first nine months of 2017 Eni achieved a net profit of €1.327bn, contrasting with its net loss of €1.391m in the same period last year. Eni made only a €18mn net profit in this year's second quarter.
Third-quarter oil and gas production net to Eni rose 5% year on year to 1.8mn barrels of oil equivalent (of which 5.01bn ft3/d gas and 885,000 b/d liquids), and by 4% to 1.79mn boe/d in the first nine months (5.14bn ft3/d and 848,000 b/d). Hence gas output – which remained more than half of overall production – was up 8.4% year on year, thanks to start-ups in Indonesia and Egypt, partly offset by the shutdowns in the UK and US Gulf.
Average upstream realised prices were up 18% year on year for oil at $48.03/b and up 21% for gas at $3.80/’000 ft3 ($3.73/mn Btu). Operating profit from Eni’s upstream was up 86% to €1.04bn.
Eni also said its performance from Gas & Power (G&P) improved, with net loss declining by two-thirds year on year to €120mn in Q3, thanks to renegotiation of long-term purchase contracts, including some contract terminations, plus portfolio optimisation. Sales volume were reduced by some 9.5% both in Italy and elsewhere, to 7.93bn m3 and 9.51bn m3 respectively. Eni G&P’s realised Italian PSV gas price was up 23% year on year in 3Q to €192/’000 m³ (or $5.33/mn Btu) while its Dutch TTF price was 27% higher at €171/’000 m³ (or $4.75/mn Btu)
Mark Smedley