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Eni Launches Implementation Phase of Coral South LNG Project
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Italian major Eni SpA (E - Free Report) has launched the Coral South LNG project implementation phase.
During the ceremony held on Jun 1, all contracts relating to the drilling, construction and installation were signed along with agreements with the Mozambican government for the regulatory framework and financing of the project.
Coral South represents the first project to be involved in the development of the considerable gas resources discovered by Eni in Area 4 of the Rovuma Basin. This milestone has been attained within three years after the drilling of the final exploration well in Mozambique. The country is being regarded as a newcomer in the global gas market.
Despite the unfavorable macro backdrop for the last few years, the launch of this project is evidence to the company’s quality of the assets in place and competency in the development of deep-water gas fields. With a capacity of about 3.4 MTPA (million tons per year), the Floating Liquefied Natural Gas (FLNG) unit, will be the first FLNG in Africa and only the third globally.
The FLNG facilities construction will be funded through Project Finance which will cover about 60% of its total cost. The financing agreement has been subscribed by 15 major international banks and guaranteed by 5 Export Credit Agencies. This is the first instance when such an agreement has been accepted for a liquefaction factor in the world.
Discovered in May 2012, the Coral field is located within Area 4 and contains about 450 billion cubic meters (16 TCF) of gas in place. In October 2016, Eni and its Area 4 partners inked an agreement with BP plc (BP - Free Report) for the sale of the entire volumes of LNG produced by the Coral South project for a period of over two decades.
Eni is the operator of Area 4, through its participation in Eni East Africa (EEA), which holds a 70% participating interest in the concession. Other partners include Portugal’s Galp Energia, South Korea’s Kogas and Mozambique’s Empresa Nacional de Hidrocarbonetos (ENH), each holding 10% stake.
Eni holds 71.4% shares of Eni East Africa with China’s CNPC holding the remaining 28.6%. In March 2017, Eni inked an agreement to divest 50% of its shares in EEA to ExxonMobil Corporation (XOM - Free Report) . Its completion is subject to the satisfaction of a number of conditions including clearance from Mozambican and other regulatory authorities.
Investor confidence on Eni’s stock is reflected in its price chart. Shares of the company have lost 0.3% in the last three months, while the Oil & Gas – International Integrated industry saw a decrease of 1.3%.
Eni currently has a Zacks Rank #3 (Hold). A better-ranked stock from the same space is Enbridge Energy, L.P. , which sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Enbridge Energy posted a positive earnings surprise of 128.57% in the preceding quarter. The company beat estimates in three of the four trailing quarters, with an average positive earnings surprise of 38.22%.
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Eni Launches Implementation Phase of Coral South LNG Project
Italian major Eni SpA (E - Free Report) has launched the Coral South LNG project implementation phase.
During the ceremony held on Jun 1, all contracts relating to the drilling, construction and installation were signed along with agreements with the Mozambican government for the regulatory framework and financing of the project.
Coral South represents the first project to be involved in the development of the considerable gas resources discovered by Eni in Area 4 of the Rovuma Basin. This milestone has been attained within three years after the drilling of the final exploration well in Mozambique. The country is being regarded as a newcomer in the global gas market.
Despite the unfavorable macro backdrop for the last few years, the launch of this project is evidence to the company’s quality of the assets in place and competency in the development of deep-water gas fields. With a capacity of about 3.4 MTPA (million tons per year), the Floating Liquefied Natural Gas (FLNG) unit, will be the first FLNG in Africa and only the third globally.
The FLNG facilities construction will be funded through Project Finance which will cover about 60% of its total cost. The financing agreement has been subscribed by 15 major international banks and guaranteed by 5 Export Credit Agencies. This is the first instance when such an agreement has been accepted for a liquefaction factor in the world.
Discovered in May 2012, the Coral field is located within Area 4 and contains about 450 billion cubic meters (16 TCF) of gas in place. In October 2016, Eni and its Area 4 partners inked an agreement with BP plc (BP - Free Report) for the sale of the entire volumes of LNG produced by the Coral South project for a period of over two decades.
Eni is the operator of Area 4, through its participation in Eni East Africa (EEA), which holds a 70% participating interest in the concession. Other partners include Portugal’s Galp Energia, South Korea’s Kogas and Mozambique’s Empresa Nacional de Hidrocarbonetos (ENH), each holding 10% stake.
Eni holds 71.4% shares of Eni East Africa with China’s CNPC holding the remaining 28.6%. In March 2017, Eni inked an agreement to divest 50% of its shares in EEA to ExxonMobil Corporation (XOM - Free Report) . Its completion is subject to the satisfaction of a number of conditions including clearance from Mozambican and other regulatory authorities.
Investor confidence on Eni’s stock is reflected in its price chart. Shares of the company have lost 0.3% in the last three months, while the Oil & Gas – International Integrated industry saw a decrease of 1.3%.
Eni currently has a Zacks Rank #3 (Hold). A better-ranked stock from the same space is Enbridge Energy, L.P. , which sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Enbridge Energy posted a positive earnings surprise of 128.57% in the preceding quarter. The company beat estimates in three of the four trailing quarters, with an average positive earnings surprise of 38.22%.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
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