ABU DHABI, UAE – Eni has signed agreements covering shares in two production concessions offshore Abu Dhabi.
Eni is paying $875 million in total for these positions. In both cases, the duration is 40 years.
Lower Zakum, 65 km (40 mi) offshore, began production in 1967. The targeted output is 450,000 b/d.
Umm Shaif and Nasr are 135 km (84 mi) offshore, with combined targeted production of 460,000 b/d.
In both cases, state oil companyADNOC operates with a 60% interest.
Tom Quinn, senior research analyst, Middle East Upstream, at Wood Mackenzie, said: “Eni is very strong in North Africa, but has traditionally been under-exposed to the Middle East when compared to its peers.”
Recently, the company has entered frontier exploration blocks offshore Oman and Lebanon – Quinn described these as “high risk but potentially high reward.
“To balance this, the ADNOC deal provides low-risk, long-term barrels, and lays the foundation for Eni’s Middle East portfolio.”
He added: “This is the first award by ADNOC to a major [in Abu Dhabi’s offshore concession renewal process], and shows it is looking to find a balance in its strategic partners between companies from major buyers, such as Japan and India, and IOCs with technology and project delivery expertise.”