Eni sells stake in Algeria-Italy gas pipelines to Snam

Italian oil and gas company Eni has agreed to sell a 49.9% stake in its subsidiaries operating two groups of gas pipelines between Algeria and Italy to energy infrastructure operator Snam for a consideration of €385 million.


The transaction includes the onshore gas pipelines running from the Algeria and Tunisia borders to the Tunisia coast (TTPC) and the offshore gas pipelines connecting the Tunisian coast to Italy (TMPC).

Pursuant to the agreement, Eni will contribute its entire ownership interests in the two pipelines to the newly incorporated Italian company NewCo in which it will continue to hold a 50.1% stake, while the remaining 49.9% will be sold to Snam for a purchase price equal to €385 million.

The transaction is expected to create synergies among the parties’ respective areas of expertise in gas transport on a strategic route for the security of the natural gas supply in Italy, enabling potential development initiatives within the hydrogen value chain from North Africa.

Eni said that the deal supports its broader strategy to optimize its portfolio and accelerate growth in sectors related to the energy transition. Snam hopes to benefit from its position on a strategic route for the security of natural gas supplies to Italy and the opportunity to support potential developments within the hydrogen value chain also by means of natural resources in North Africa.

In addition, the agreement provides for an earn-in and earn-out mechanism to be calculated on the basis of the revenues that will be generated by the target companies. The partners will exercise joint control over NewCo on the basis of equal governance principles and both companies will therefore consolidate the new company through the equity method.

“This transaction allows us to free up new resources to be used on our energy transition path, while at the same time maintaining the management of a strategic infrastructure with Snam to ensure the security of natural gas supply to the country,” said Eni CEO Claudio Descalzi.

“Gas will play a key role in the transition of energy systems to zero-emission models, and it is important to maintain the availability and diversification of supply routes for this resource.”

The closing of the transaction is subject to certain conditions, including mandatory authorizations pursuant to antitrust and “golden power” regulations and from other competent regulatory authorities, in addition to the authorization from the Tunisian government and the consent and/or approval of the shareholders and boards of directors.

The transaction is expected to be completed by the third quarter of 2022.