Page 4 - AsianOil Week 50 2020

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Eni seeks exit from

Pakistani upstream

Weak oil and gas prices, coupled with concerns over corruption and bureaucracy,
have undermined investor confidence in the country’s upstream potential

COMMENTARY ENERGY shortages have long plagued Pakistan, Heading for the door
owing to a stagnation in natural gas production The Italian major wants to sell its Pakistani
over the last decade and a half. The government upstream assets as part of a wider portfolio
WHAT: has strived to ensure energy security not by shake-up that will deepen its focus on renewable
Eni could sell its revamping the country’s upstream regulatory energy sources.
upstream assets as soon environment but by turning to international The company has opened up talks with
as March. suppliers. potential buyers for its fields, including the pro-
For years the government talked up the possi- ducing Bhit, Badhra and Kadanwari permits in
WHY: bility of building a pipeline to import Iranian gas Sindh Province, Reuters said on December 11,
The company is supplies, before it finally threw its weight behind citing unnamed sources as saying. The major
rationalising its upstream a series of liquefied natural gas (LNG) terminals could have a deal in place before the end of
portfolio. instead. March, one insider said.
The country is not without upstream poten- “It’s a small country for Eni in the sense it
WHAT NEXT: tial, but chronic corruption, domestic unrest has little business there and so it makes sense to
Pakistan will struggle to and a lacklustre approach to energy policy has rethink operations,” another source said.
attract major upstream left international investors cold. Not only is for- The Italian developer, however, wants to keep
investment without eign direct investment (FDI) in Pakistani oil and its photovoltaic (PV) solar power plant, which
significant reforms. gas fields noticeably scant, but the country is now can produce 20 GWh per year. The company
on the verge of losing one of its last international inaugurated the Bhit PV plant, which was built
majors. to support its upstream operations by providing
While Italy’s Eni has reportedly been looking off-grid green power, in November 2019.
to divest its Pakistani production assets since the Although the plant was only designed to sup-
middle of year, the company is now rumoured port local upstream operations, Eni’s evolving
to be just a few months of away from securing climate change goals have turned the facility into
a deal. a strategic asset.

P4 www. NEWSBASE .com Week 50 17•December•2020