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Eni Discovers Gas in the Faramid South Prospect in Egypt

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Eni SpA (E - Free Report) discovers gas in the Egyptian Western Desert.

The well has been drilled on the Faramid South exploration prospect.  The prospect is located in East Obayed concession, 30 kilometers North-West of the Melehia Concession. The well was drilled to the target depth of 17,000 feet and bumped into numerous gas bearing layers in the Kathabta sandstones of Jurassic age.

The potential of the East Obayed Concession was established when the well delivered 25 million standard cubic feet per day (mmscfd) after commencing production.

The relevant gas reserves along with the gas potential of the Melehia Concession, that are expected to boost gas production from the Western Desert Basin, is under evaluation now.

Currently, Eni, through its operating company — AGIBA — produces 55,000 barrels of oil equivalent per day from the Egyptian Western Desert. AGIBA, which is equally held by Eni’s subsidiary IEOC and the Egyptian General Petroleum Corporation (“EGPC”), owns 100% of the East Obayed Concession.

Eni’spresence in Egypt dates back to 1954.The company is the primary producer with about 320,000 barrels of oil equivalent per day. In 2018, the production is anticipated toimprove significantly, owing to the ramp up of the Zohr field.

Eni’s constant efforts to expand upstream operations will go a long way in generating profitable growth. The start-up of new upstream projects in Ghana and Angola is expected to support oil production. The company’s discovery of roughly 4.4 billion barrels of oil reserves in the past four years, amid unfavorable crude pricing environment, is noteworthy.

Price Performance

In the past year, Eni’s shares have increased 17% compared with the industry’s 14.1% rise.



 

Zacks Rank & Stocks to Consider

Eni currently carries a Zacks Rank #3 (Hold).

A few better-ranked players in the same sector are Petroleo Brasileiro S.A. (PBR - Free Report) , or Petrobras SA, Helix Energy Solutions Group, Inc (HLX - Free Report) and TC Pipelines, LP . All these stocks flaunt a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Petrobras is the largest integrated energy firm in Brazil and one of the major players in Latin America. It pulled off an average positive earnings surprise of 10.4% in the last four quarters.

Helix Energy offers specialty services to the offshore energy industry. The company delivered an average positive earnings surprise of 66.7% in the trailing four quarters.

TC Pipelines purchases, owns and actively participates in the management of U.S.-based natural gas pipelines and related assets. The company delivered an average positive earnings surprise of 3.7% in the last four quarters.

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