Page 15 - EurOil Week 30

EurOil INVESTMENT EurOil

Eni eyes $1bn sale of Jotun FPSO

ITALY VAR Energi, a Norwegian joint venture between around 300,000 barrels of oil equivalent per
Italy’s Eni and private equity firm HitecVision, day (boepd).
Eni has reportedly wants to raise $1bn from the sale of In the Republic of Congo, Eni’s production
the Jotun floating production storage and off- grosses over 90,000 boepd at operated assets
loading (FPSO) vessel. and 56,000 boepd at non-operated assets. It is
According to a Bloomberg report last week, preparing to exploit the Nene Marine field in
Var Energi is working with advisors on divest- the country, targeting a plateau output rate of
ing the Jotun vessel, while Eni is separately more than 120,000 boepd after several stages of
looking to sell assets in the Republic of Congo development.
(Brazzaville). As of press time, neither Eni, HitecVision or
If a Norwegian sale is completed, Var Energy Var Energi had commented on the alleged plans.
will continue to lease the recently upgraded Majors such as Eni have fast-tracked their
FPSO as it prepares to extend production at its divestment plans in light of the oil price crash,
Balder oilfield, sources told Reuters on July 27. which has left them short of cash. Many are look-
The $1.7bn Balder X project aims to recover an ing to dispose of assets in the mature North Sea,
extra 170mn barrels of crude. as the region offers smaller returns than projects
Var Energi is Norway’s biggest non-state oil in emerging and frontier basins.
and gas producer, after acquiring ExxonMobil’s Eni CEO Claudio Descalzi hinted earlier
portfolio in the country last year. The company, this month that the firm might consider divest-
which is 70% owned by Eni, said at the time ing some of its conventional oil refineries in
it would seek to divest some of the assets it Italy, which were hard hit by the coronavirus
picked up in the $4.5bn deal. It currently flows (COVID-19) pandemic. ™
PERFORMANCE

Lundin’s Q2 income declines,

Sverdrup offers bright spot.

SWEDEN SWEDISH player Lundin Energy suffered a 162,900 boepd, which is more than double the
decline in second-quarter earnings, despite its 76,100 boepd average it achieved in the same
Lundin gained from output soaring to a new record thanks to the period last year. But it has kept its 2020 produc-
Sverdrup’s ramp-up. ramp-up at Norway’s Johan Sverdrup oil project. tion guidance unchanged at 157,000 boepd, as
The company’s earnings before interest and maintenance will take place in the third quarter
tax (EBIT) fell to $166.1mn, from $279.8mn at its Edvard Grieg field.
a year earlier, primarily due to much weaker “As we enter the second half of the year, all off-
prices. But Lundin gained from its 20% stake in shore facilities have returned to normal manning
the Equinor-operated Sverdrup field, which was levels and the [ongoing[ projects are progressing
launched last autumn and is now flowing oil at a on plan,” Schneiter said.
rate of 470,000 barrels of oil equivalent per day Lundin is mulling the approval of eight new
(boepd). projects, including the Alta deposit in the Bar-
Under Sverdrup’s first phase, production was ents Sea, in light of new tax incentives offered by
expected to plateau at only 440,000 boepd, but the Norwegian government.
Equinor and its partners were able to raise this “We will be aiming to accelerate appraisal
by increasing the field’s processing capacity. The activities and field development studies for all
group are now testing to see if even more oil can of these potential projects, with the objective of
be produced. maturing them to sanction prior to the deadline
“We are working on a plan to test the Sver- at the end of 2022,” it said.
drup’s capacity in a few months to see if we can Lundin also plans to move ahead with explo-
achieve the rates above 470,000 boepd,” Lundin ration activities again in the fourth quarter. Its
CEO Alex Schneiter told analysts. campaign involves three wells in the southern
Lundin’s output surged to a new height of Barents Sea. ™

Week 30 30•July•2020 www. NEWSBASE .com P15