International Finance
Oil & Gas

Eni SpA might sell stake in Mexican offshore oilfield to Qatar Petroleum

Eni SpA, Qatar Petroleum, Mexico, Campeche Bay, exploration, production, oil & gas, oilfield, offshore oil
Italy's Eni SpA is in talks with Qatar Petroleum International to sell a stake in its Campeche Bay offshore oilfield discovery in Mexico, according to a Bloomberg report

The Italian oil major, which currently holds 100% of the offshore find in Campeche Bay and expects to start production in early 2019, is expected to sell 20-35% to Qatar Petroleum. The details of the deal are not public yet.

Eni, is apparently, in talks with other companies too. The company has sought to sell minority stakes in fields it operates to fund future development and support dividends, generating US$9bn in the last four years with the strategy it calls the ‘dual exploration model’, said the report.

The Rome-based company, which has boasted record production and a string of discoveries including the giant Zohr gas field in Egypt, won the area in Mexico’s second-ever oil auction in 2015. The deal would mark the first Mexico farm-out, a joint-venture in which help in developing an oil area is exchanged for a stake, by companies other than Petroleos Mexicanos since the country opened its oil industry to competition in 2013, ending three-quarters of a century of state monopoly over exploration and production

If negotiations are successful, Qatar Petroleum would hold an interest in an area comprising the Amoca, Mizton and Tecoalli shallow-water oil fields in the southern Gulf of Mexico, which Eni estimates may hold the equivalent of 2 Bbbl of oil. The Italian driller has picked up blocks in subsequent tenders in Mexico, including a deep-water prospect in a partnership with Qatar Petroleum. For its part, Qatar Petroleum nabbed three other blocks in the same bidding round in January.

Eni is among a number of European drillers that have swarmed Mexico’s newly opened oil territory. An auction Last month saw blocks awarded to the UK’s BP Plc, France’s Total SA, Spain’s Repsol SA, Lukoil PJSC and DEA Deutsche Erdoel AG of Germany, among others. The next tenders, including one for onshore areas and another for shale, will be held in July and September, respectively — prior to the end of President Enrique Pena Nieto’s term.

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