Italy’s Eni SpA (E - Free Report) has initiated seismic survey work in the Fedynsky and Central Barents license areas, in Russia’s sector of the Barents Sea. The survey is part of Eni’s exploration pact with Russia’s state-owned giant Rosneft.
The 2D seismic survey will cover 6,182 miles of the two license areas, lying in the ice-free part of the Barents. The survey, which follows the environmental and fishery studies, conforms to the Russian legal environmental requirements and license agreements.
Environmental monitoring is likely to be implemented at some stage of seismic shooting. A specialized seismic survey vessel will be employed to collect the data of the survey using geophysical methods.
The two companies had set up a venture to explore each of the Russian offshore projects. These projects form part of a wider cooperation between Eni and Rosneft under the Strategic Cooperation Agreement signed by the parties on April 25, 2012.
In the joint venture, Eni and Rosneft have a share of 33.33% and 66.67%, respectively. Per the agreement, Eni is responsible for funding of exploration work.
The agreement includes the Western Chernomorsky block in the Black Sea, along with the Fedynsky and Central Barents license areas. Together, these areas are estimated to hold total recoverable resources of 36 billion barrels of oil equivalent.
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 of more than 4% growth annually in the said period and 3% annually until 2022.
Eni carries a Zacks Rank #3 (Hold). However, Zacks Ranked #1 stocks – Alliance Resource Partners LP (ARLP - Free Report) , Newpark Resources Inc (NR - Free Report) and Boardwalk Pipeline Partners, LP (BWP - Free Report) – are expected to outperform in the near term.