Eni SPA ( E Quick Quote E - Free Report) entered an agreement with Algeria-based energy company Sonatrach to increase natural gas imports to Italy via the Enrico Mattei (TransMed) pipeline system.
The agreement is covered under a long-term gas supply contract, expected to take effect from September 2022.
Italy imports about 40% of its natural gas from Russia. The country has been struggling to diversify its energy supply mix due to the escalating tensions over the Russia-Ukraine conflict.
The Transmed pipeline system has a daily capacity of more than 110 million cubic meters. At present, it transports only 60 million cubic meters. The latest agreement will help utilize the pipeline’s available transportation capacities to increase supply flexibility. It will increase natural gas volumes from 2022, with up to 9 billion cubic meters annually in 2023-24.
Russia’s invasion of Ukraine has triggered sweeping Western-led sanctions, which are likely to disrupt energy flows and increase the fear of gas shortages. The latest agreement has come when Europe plans to increase its gas supplies and secure its energy policies amid the Russia-Ukraine conflict.
Eni has been contributing to Algeria’s growth since 1981, with an equity production of 100,000 barrels of oil equivalent per day in the country. Notably, the company’s unique fast track model offers a significant production potential for the Algerian fields.
The agreement highlights the strong relationship between the companies and their efforts in renewables as well as exploring and producing hydrocarbons. Apart from its exploration and development program, Eni is seeking opportunities in renewables, hydrogen, carbon capture, use and storage, and bio-refining to achieve carbon neutrality by 2050.
Company Profile & Price Performance
Headquartered in Rome, Italy, Eni is one of the leading integrated energy players in the world.
Shares of Eni have outperformed the
industry in the past month. The stock has gained 5.7% compared with the industry’s growth of 3%.
Image Source: Zacks Investment Research Zacks Rank & Other Stocks to Consider
Eni currently flaunts a Zack Rank #1 (Strong Buy).
Investors interested in the
energy sector can take a look at the following companies that also presently sport a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here .
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