Italian energy giant, Eni SpA (E) reveals its plan to sell natural gas to the residential customers of France through its own brand, vying to be one of the major players in the French residential market.
Eni first started supplying gas to France back in 2003. It has been supplying gas to the retail market through the brand Altergaz. Effective October 1, the company has also begun to deliver gas to residential customers. It hopes to reach out to 500,000 customers, thereby trebling its residential customer base in the country.
Currently, Eni as a gas supplier occupies the second largest position in France and delivers 74 TWh of gas. It represents about 14% of the total market. Eni’s expansion plan consists of four new retail products. These are: Horizon (a 3-year fixed price offer); Oxygène (a 3-year fixed price carbon-neutral preference); Préférence (a price scheme that customers can alter as per their preferred options); and a discounted tariff package called Essentiel.
Eni with its consolidated subsidiaries is engaged in oil and gas, electricity generation, petrochemicals, oilfield services and engineering industries and has a presence in 85 countries. In France, the company remains operational in fuel supply, the gas market, petrochemical (Versalis) and oil & gas industry engineering (Saipem).
Although we appreciate Eni’s endeavors in France, we are cautious regarding the uncertainty associated with the group's gas business (sales of which went down 4% year over year in the second quarter). The European gas market is expected to remain weak against the backdrop of sluggish demand, abundant supplies and ongoing competitive pressures.
Eni recently entered into a sale and purchase agreement with the U.S. super major Chevron Corporation (CVX) for 25% farm-in to three exploration blocks – LB 11, LB 12 and LB 14 – in offshore Liberia. The stock carries a Zacks #3 Rank, which is equivalent to a Hold rating for a period of one-to-three months. Longer term, we maintain our Neutral recommendation.
More From Zacks.com
- Investment & Company Information
- Eni SpA
- natural gas