Italy's biggest oil and gas company -
) - has finally announced that it will start operations in the
massive Kashagan field in Kazakhstan by March 2013.
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The project encountered several delays since its discovery, owing
to technical problems of extracting oil in an extreme climate and
the presence of sulphide in the associated natural gas. Apart from
these hurdles, rising costs have also emerged as an impediment.
However, overcoming all these hurdles, Eni is set to bring the
field online by March 2013.
The field, discovered in July 2000, is developed by a consortium
including Eni SpA,
Royal Dutch Shell Plc
), French energy giant
), Japan's INPEX Holdings Inc and KazMunaiGas. Earlier in 2012, the
consortium had agreed on a deadline of June 2013 for project
commencement with the Kazakh authorities.
Currently, Eni is concentrating on ascertaining the amount of
natural gas reserves in offshore Mozambique that it has access
to. As of now, Eni is not contemplating the divestment of its
70% interest, but may consider selling a portion of its equity in
the near future.
Eni's talks with Houston-based
Anadarko Petroleum Corp.
) have been encouraging so far, regarding the utilization of their
offshore Mozambique observations and finds.
Eni's operations in Africa forms a vital part of its portfolio as
it proceeds to strengthen its long-term growth with plans to
concentrate more on upstream operations.
Increasing competition and declining demand affected Eni's gas and
power division while its refining business was also in loss during
the second quarter of 2012. Therefore, it intends to reposition and
benefit from more lucrative upstream operations.
Eni retains a Zacks #3 Rank, which is equivalent to a short-term
Hold rating. We also maintain our Neutral recommendation for the