Italy: Eni Quarterly Profit Soars

After announcing the major natural gas discovery off the coast of Mozambique, Eni, the international oil and gas company, has today announced the Group preliminary results for the fourth quarter and the full year 2011.

The Italian oil giant reported full year 2011 net profit €6.89 billion (up 9%)  and €1.32 billion for the quarter (up 141%).

Paolo Scaroni, Chief Executive Officer, commented:

“2011 was a year of significant exploration success for Eni. The large Mamba discovery in Mozambique opens up extraordinary development opportunities and is ideally  placed to serve the fast-growing Asian gas markets. We have also made important discoveries in the Barents Sea, Angola and South-East Pacific. Meanwhile, we have rapidly  restarted our Libyan operations, reducing the impact of the Revolution on 2011 results. The difficult macro economic situation in Italy and Europe has impacted our results in Gas & Power, Refining & Marketing and in the petrochemical sector. Despite that, thanks to our excellent strategic positioning, Eni will continue to generate industry-leading results, and create value for its shareholders in the long term”.

Capex

Capital expenditure amounted to €3.89 billion for the quarter and €13.44 billion for the full year, mainly relating to the continuing development of oil and gas reserves, the upgrading of rigs and offshore vessels in the Engineering & Construction segment and of the gas transport infrastructure. The Group also incurred expenditures of €0.36 billion to finance joint-venture projects and equity investees.

Exploration & Production

In the fourth quarter of 2011, Eni’s reported liquids and gas production of 1.678 mmboe/d down by 14.1% from the fourth quarter of 2010 (down by 12.9% from 2010). This  reduction was driven by a lowered flow from Eni activities in Libya, which was affected by the shut down of almost all the company’s plants and facilities including the  GreenStream pipeline throughout the peak of the Country’s internal crisis (which lasted approximately 6 months). The extraordinary effort made in the last part of the year  to restart production and reopen the GreenStream pipeline enabled the Company to bring back online an average Libyan output of 160 kboe/d in the quarter, up from  approximately 50 kboe/d in the third quarter, partly offsetting the impact of force majeure. Performance for the quarter was impacted by lower entitlements in the  Company’s PSAs due to higher oil prices with an overall effect of approximately 20 kboe/d compared to the previous year’s (approximately 30 kboe/d from the full year).  When excluding these negative effects, the production of the two reporting periods was unchanged. The ramp-up of the field started in 2010 and the 2011 start-ups, in  particular in Italy and Australia in the fourth quarter, offset a lower-than-anticipated growth in Iraq and the impact of planned facility downtimes, particularly in the UK and  Kazakhstan in the quarter.

[mappress]
Offshore Energy Today Staff, February 15, 2012; Image: Eni