Eni Reports Higher Output, LNG Sales
Eni reported a profit of €946mn ($1.1bn) for the first quarter, the company said April 27. That was down 2% year on year but CEO Claudio Descalzi pointed to a higher Brent price that helped pushed adjusted operating profit for its upstream business up 47% to €2.1bn. He added: “LNG achieved significant results due to increased integration with other group activities,” increasing in volume by 35%.
Group adjusted pre-tax operating profit, reflecting business performance, was up 30% at €2.38bn. During the quarter, Eni agreed the sale of a further 10% stake in its giant Egyptian Zohr field to Abu Dhabi-owned Mubadala, yet to be completed. This week Eni announced that gross capacity was rising as planned at Zohr, offshore the Nile Delta, reaching 800mn ft3/d.
Production rose 4% year on year to 1.867mn barrels of oil equivalent/d, of which gas was up 2% to 5.36bn ft3/d and liquids were 6.4% higher at 885,000 b/d. Average realised prices were up by about one-quarter to $61.17/b for liquids, and $4.50/'000 ft³ for gas.
Gas & Power posted an adjusted pre-tax operating profit of €322mn, down 5% and global sales of gas fell 4% to 22.4 bn m3, which included an 8% rise in sales inside Italy to 11.2bn m3 but a 20% decline in sales to the rest of Europe to 9.3bn m3. However LNG sales rose 35% to 2.7bn m3. It sold 9.22 TWh of electricity, down 1.6% chiefly following the sale of its Belgian retail business to Dutch firm Eneco. Eni also booked a €13mn impairment on the pending sale of its Hungarian gas distribution business.
Group net debt increased slightly to €11.3bn at end-March 2018, from €10.9bn three months earlier.
Eni said its outlook for the rest of 2018 includes new start-ups in Ghana (the OCTP field) and Angola (both being offshore oil and gas), a decline in piped gas sales in line with an expected reduction in long-term purchasing, but further synergies and an expected increase in its LNG contracted volume to roughly 6mn mt/yr.