Eni has signed an agreement with Sonatrach to acquire a stake of 49% across three oil concessions in the onshore North Berkine basin in the Algerian desert.
Image: Eni to acquire 49% stake in three oil concessions in North Berkine basin. Photo courtesy of PinkBlue/FreeDigitalPhotos.net.
The three blocks located in the North Berkine basin that are part of the agreement are Sif Fatima II, Zemlet El Arbi and Ourhoud II in which the Algerian state-owned oil and gas firm Sonatrach will retain a stake of 51%.
The transaction will be based on approval from the Algerian authorities.
Eni CEO Claudio Descalzi said: “Today’s agreement is further confirmation of Algeria’s strategic importance, where Eni has planned significant investments over the next few years.
“With Sonatrach, we will work together to position North Berkine basin as a gas hub. The country still has a lot of gas and Eni will leverage its technology and skills to develop it”.
By taking part in the three licenses, which are spread over a total area of 8500km2, Eni will be consolidating its position in the North Berkine basin further. The Italian oil and gas major has maintained a strong position in the onshore Algerian basin since 1981 where all its current production assets are also located.
Some of the assets held by Eni in the North Berkine basin include Bir Rebaa North (BRN) which has been producing oil since 1995.
Eni and Sonatrach have agreed to take up an exploration program to develop the reserves of the Sif Fatima II, Zemlet El Arbi and Ourhoud II blocks, which are estimated at a combined 145 million barrels of oil equivalent.
Production from the three onshore blocks is anticipated to begin by the end of 2020.
According to Eni, the development of the three concessions in the North Berkine basin will benefit from synergies with existing facilities in the area, along with new projects and infrastructure that are currently being built. Included in these is a 180km-long gas pipeline that will connect the BRN and MLE oil fields.
In another development, Eni has made an agreement with French oil and gas major Total to seek exploration permits in offshore Algeria.
Overall, Eni is currently taking part in 32 mining permits in Algeria with an equity production of 90,000 boe per day.
In another part of Africa, in Mozambique, the Italian oil and gas firm alongside South Africa-based Sasol won exploration and development rights for deep offshore block A5-A located in Northern Zambezi Basin.