Italy-based Eni SpA’s (E) share price rose 2.4% following the news of its collaboration with state-owned KazMunayGas (KMG) to jointly discover an offshore oil field. Notably, the move will also enable Eni to increase its footprint in Kazakhstan.
Per the agreement, both Eni and KMG will hold 50% stake each, of the exploration and production rights in the Isatay offshore exploration block in the north Caspian Sea. The block, likely to be operated by a joint operating company, is projected to have considerable oil resources.
The agreement also entails the development of a shipyard project on the Caspian Sea coast of the Mangystau region at Kuryk. The shipyard will be controlled by a project company, which will be formed by Eni and KMG.
Eni, which already has a presence in the Republic of Kazakhstan, where it co-operates the Karachaganak field and is equity partner in numerous fields in the north Caspian Sea like the giant Kashagan field, expects the latest agreement to strengthen its position in the region.
Eni, with its consolidated subsidiaries, is engaged in oil and gas, electricity generation, petrochemicals, oilfield services and engineering industries. The company’s major business segments are Exploration and Production, Gas and Power, and Refining and Marketing. The company conducts its major exploration and production activities for hydrocarbons. Eni operates these activities out of Italy, Croatia, North Africa, West Africa, the North Sea, the Gulf of Mexico, the Middle and Far East, the Caspian Sea, Australia and Latin America.
At present, Eni carries a Zacks Rank # 5 (Strong Sell). However, better-ranked players in the energy sector like Magellan Midstream Partners LP (MMP), Ultra Petroleum Corp. (UPL) and Encana Corp. (ECA), all sporting a Zacks Rank #1 (Strong Buy), are worth reckoning.
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