Back to top

Analyst Blog

Italian energy company Eni SpA (E - Analyst Report) has made two major natural gas discoveries in the Mamba Complex, in Area 4, offshore Mozambique – representing the third find in 2012, with the likelihood of more such to come in coming months.

The delineation wells – Mamba South 2 and Coral 2 - represent the sixth and seventh wells that have been drilled consecutively and have added about 6 trillion cubic feet (Tcf) of gas in place to Area 4. With these new discoveries, Area 4 now has 68 Tcf proven gas in place, with potential of around 23 Tcf plus.

The full potential of Mamba Complex is expected to be appraised through the upcoming delineation wells, while the initial estimations show 75 Tcf of gas in place.

Located about 9 kilometers east of Mamba South 1 and about 50 kilometers off the Capo Delgado coast – Mamba South 2 – was drilled in 1,918 meters of water and touched a total depth of 4,300 meters. The well hit 60 meters of gas pay in high quality Oligocene reservoirs and the discovery confirmed the presence of hydraulic communication with the same reservoir of Mamba South 1. The flow tests showed stellar results and guided a production rate of 140 million standard cubic feet per day.

Located around 15 kilometers northwest of Coral 1 and around 50 kilometers off the Capo Delgado coast – Coral 2 - was drilled in 1,950 meters of water and touched a total depth of 4,725 meters. Eni proposes to conduct a production test in the Coral 2 find, where it came across 140 meters of gas pay in good quality Eocene reservoirs. The discovery established the presence of hydraulic communication with the same reservoir of Coral 1.

Eni, the operator of Area 4, holds a 70% participating interest. Each of the other partners – Portugal’s Galp Energia, Korea’s KOGAS and Mozambique's ENH – hold a 10% stake.

With the intention of evaluating the full potential of the Mamba Complex finds, Eni proposes to drill at least two more wells – Coral 3 and Mamba South 3 – in a row. Mozambique has gained immense attention by various oil giants following several gas field discoveries by Eni and U.S. explorer Anadarko Petroleum Corporation (APC - Analyst Report).

Eni holds a Zacks #3 Rank that is equivalent to a Hold rating for a period of one to three months. Longer term, we maintain our Neutral recommendation.
 

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
RPC INC RES 24.91 +8.35%
LITHIA MOTO… LAD 94.59 +4.60%
DELTA AIR L… DAL 39.15 +3.90%
FLAMEL TECH… FLML 14.51 +3.50%
SOUTHWEST A… LUV 28.87 +2.92%