Yahoo Finance Eni Meets $4.7 Billion Financial Close for Coral South FLNG
Eni S.p.A. E recently announced that it has achieved financial closure for the Coral South floating liquefied natural gas ("FLNG") project, located in Area 4 of Rovuma Basin offshore Mozambique. Investors should know that $4.7 billion financing for the FLNG development has been confirmed by the company.
A floating LNG plant will work on the southern part of the Coral gas reservoir with a capacity of 3.4 million tons per annum (MTPA). It will be moored at the sizeable gas resource at a depth of 2,000 meters. The first phase in the field requires an investment of $8 billion, believed to contain 450 billion cubic meters of natural gas. It is important to remind investors that in 2016, BP p.l.c. BP had agreed to buy the whole liquefied natural gas (LNG) production made by the Coral South FLNG.
Operations in the field are expected to begin by mid-2022. With plans to operate for 25 long years, The Coral South FLNG facility is estimated to produce five trillion cubic feet of gas over the target time frame.
Eni operates the FLNG project through its subsidiary Eni East Africa with 25% interests while ExxonMobil Corp. XOM holds another 25%. This apart, China Southern Petroleum Exploration and Development Corp., Empresa Nacional de Hidrocarbonetos E.P., Korea Gas Corp. and Galp Energia GLPEY possess 20%, 10%, 10% and 10% stakes, respectively.
About the Company
Headquartered in Rome, Italy, Eni is a leading integrated energy player with operations spread worldwide. Investors should know that the start-up of new upstream projects in Ghana and Angola as well as Indonesia has been supporting Eni's oil-production growth.
However, the company is highly leveraged as its increasing debt load is reflective of its weak balance sheet. Also, exploration expenses during the first nine months of 2017 escalated 29.6% compared with the same period, last year. Moreover, Enihas gained 1.4% year to date, underperforming the 3.4% growth of its industry.
Zacks Rank
Eni carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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