Eni (E) Signs Agreement to Increase Gas Production in Libya
Eni SpA E entered an agreement with Libya’s National Oil Corporation to develop the Structures A&E project, which is designed to increase gas production to supply the Libya market and ensure export to Europe.
Structures A&E is believed to be the first major project in Libya in more than two decades. The project will involve two gas fields, located in the contractual area D offshore Libya.
The gas will be produced through two main platforms tied to existing treatment facilities at the Mellitah Complex. Production from the fields is expected to reach a plateau production of 750 million standard gas cubic feet a day. Production is expected to commence in 2026.
The project also includes the development of a carbon capture and storage facility at Mellitah. This will significantly reduce the overall carbon footprint, in line with Eni’s decarbonization strategy. The deal will have a duration of 25 years, with an estimated investment of $8 billion.
Eni has been contributing to Libya’s growth since 1959, with a share of 80% of the national production. The deal will enable important investments in Libya’s energy sector. This will support local development and job creation, while strengthening the company’s role as a leading operator in the country.
Libya authorities have been working to secure major investments in their energy industry. The country managed to significantly boost production over the past year and is planning to reach 1.6 million barrels per day. The project will have a major influence on the industry and the associated supply chain, marking a significant contribution to the Libya economy.
Shares of Eni have outperformed the industry in the past six months. The stock has gained 30% compared with the industry’s 18.7% growth.
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Zacks Rank & Key Picks
Eni currently carries a Zack Rank #3 (Hold).
Investors interested in the energy sector might look at the following companies that presently carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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