Eni, an Italian oil and gas company, announced that it had made a major oil discovery in Angola that would boost its credentials as one of the most successful foreign oil producers in Africa in recent years.
The discovery, which is considered to be Angola’s largest offshore discovery in years, may help Africa’s second-biggest crude producer avoid a steep decline in output due to the ageing of its other fields.
In Angola, oil accounts for 95 percent of exports and around 70 percent of revenues, and the government has recently offered better fiscal terms and more collaboration to international energy firms in an effort to help its mostly impoverished population.
The company said its new Agogo prospect in Angola’s deep waters contained between 450 million and 650 million barrels of light oil with potential for further upside. The oil and gas firm also noted that data from the exploration well pointed to a production capacity of more than 20,000 barrels of oil per day.
Jason Kenney, Santander’s oil analyst said “this is a valuable find of light, sweet oil which they will be able to fast-track to meet increasing demand in 2020-2021”.
Eni has been in Angola since 1980. The firm will operate at the field with a stake of 36.8 percent, the same as Angola’s state-owned Sonangol, while SSI Fifteen Ltd has 26.3 percent.
Angola, a member of the Organization of the Petroleum Exporting Countries, is a key location for the Italian state-controlled major. The company currently produces around 155,000 barrels of equity oil equivalent per day in the African nation.
In 2018, the company produced 1.85 million barrels per day and was struggling to replace reserves a decade ago and lost credibility over its management of the huge Kashagan oilfield in Kazakhstan. However, giant gas finds at Mamba in Mozambique and Zohr in Egypt have since given it the strongest discovery record in the industry.
Eni produces more than half its oil and gas in Africa, but has made a move to diversify away from the continent by clinching a series of deals in the Gulf region.