Italian energy giant
) has inked a $4.21 billion deal with China National Petroleum
Corporation (CNPC) for divesting a stake of about 20% in Area 4,
CNPC farmed into the prospect by purchasing 28.57% of the shares
of Eni East Africa, which holds 70% in Area 4. Other partners in
the license are Empresa Nacional de Hidrocarbonetos de Mocambique
(ENH), Korea's Kogas and Portugal's Galp Energia. Each hold a 10%
The transaction is based on the execution of certain standard
conditions, including attaining all essential approvals from
As per reports released earlier this month, the two companies
have been discussing the stake deal for the past six months.
CNPC's entry into Area 4 is strategically vital for the project
mainly due to its worldwide importance in the upstream and
Both the companies have also inked a Joint Study Agreement for
the development of the Rongchang shale gas block. Located in the
Sichuan Basin, the approximately 2,000 square kilometer Rongchang
shale gas block has the highest potential, based on the
production tests conducted so far.
The license is situated in a region, which is in close proximity
to the key gas consuming markets in China and has been de-risked
by research activities. The contract will facilitate inspection
of the region as well as negotiations for the Production Sharing
Eni holds a Zacks Rank #4 (short-term Sell rating). However,
there are other stocks in the energy sector, namely,
Range Resources Corporation
EPL Oil & Gas, Inc.
) , which carry a Zacks Rank #1 (Strong Buy) and are expected to
perform impressively over the next few months.
ENI SPA-ADR (E): Free Stock Analysis Report
EPL OIL&GAS INC (EPL): Free Stock Analysis
ENERPLUS CORP (ERF): Free Stock Analysis
RANGE RESOURCES (RRC): Free Stock Analysis
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