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Italian oil giant Eni SpA (E - Analyst Report) has enhanced its resource base in the West Hub project with its ninth oil find in Block 15/06, offshore deepwater Angola.

Located about 150 kilometers from the coast, the probe Vandumbu 1 has produced 114 meters of net oil pay. The well reached a total depth of 4,107 meters and was drilled at a water depth of 976 meters.

Eni drilled from the sidetrack of the Vandumbu 1 well – Vandumbu 1 ST –to a depth of 3,480 meters and revealed the Lower Miocene high quality sand, 34-degrees API oil pay. Based on the data collected, Eni has estimated Vandumbu 1 ST to have a production capacity of more than 5,000 barrels of oil per day.

Eni, the operator of Block 15/06 holds a 35% interest. Other partners include SSI Fifteen Limited, Sonangol, Total SA (TOT - Analyst Report), Falcon Oil Holding Angola SA and Statoil ASA (STO - Analyst Report) holding 25%, 15%, 15%, 5% and 5%, respectively.

The company’s presence in Angola dates back to 1980. In 2011, the company had a net production of 102,000 barrels per day. The latest discovery further strengthens its position in the country and confirms the region as one of the core countries in Eni’s organic growth strategy.

We believe that Eni’s outlook for the upcoming months is favorable, given its 2013–2016 strategic plans to enhance production and implement steps to control costs and recover profitability. The company remains upbeat on its production growth target, expecting it to increase more than 4% per year for 2013–2016 and 3% per year until 2022.

Eni holds a Zacks Rank #4, which is equivalent to short-term Sell rating. However, another stock in the energy sector, namely, Range Resources Corporation carries a Zacks Rank #1 (Strong Buy) and is expected to perform impressively over the next few months.

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