Eni notes Libya Risk, but also Gas Potential

“Libya is a core country for us, although we are not investing as much there as before,” acknowledged Eni CEO Claudio Descalzi in response to an analyst question during its March 18 annual strategy briefing in London.

Descalzi said average production operated by Eni in Libya is 250,000 boe/d. This contrasts with some other operators that have halted operations there because of security issues. Most of Eni’s output is oil however the Eni chief also addressed future prospects for additional gas production offshore.

“Libya has a huge potential,” the Eni chief insisted: “We made a discovery offshore Libya last year: Bahr Essalam [South]” -- a gas condensate find made in March 2015.

“We could double our gas/condensate production in Libya” said Descalzi – however without predicting when such a hypothesis could unfold. The company’s March 18 presentation indeed pointed to start up of ‘Bahr Essalam phase 2’ in Libya during 2018.

Eni’s website described the March 2015 Bahr Essalam South find as a “significant gas and condensate discovery” operated  by Eni with a 100% share in the exploration phase, adding that the proximity of these new discoveries to existing infrastructure will facilitate rapid  development.”

Another analyst asked if the Wafa gas compressor project onshore Libya, which featured Eni’s four-year strategy a year ago, had been omitted now in the 2016-19 Plan.

Descalzi replied: “Wafa is in the south, in the [Libyan] desert. At the moment we consider it’s safer to work offshore than onshore. But it’s still in the [2016-19 development] plan.”

Mark Smedley