Eni seeks to cut stake in Egypt's Zohr gas field to 50%, CEO says

|By:, SA News Editor

Eni (E +0.7%) CEO Claudio Descalzi says the company is in talks with various parties to cut its stake in the giant Zohr gas field offshore Egypt to 50%, following last week's agreement to sell a 10% stake to BP for $375M.

BP, which has an option to buy another 5%, also will reimburse Eni for ~$150M of past costs, and analysts at BofA Merrill Lynch say the $525M capital injection from the Zohr deal "helps to cover the dividend in the short term and is evidence that Eni can execute disposals after the failed sale of [chemical unit] Versalis earlier in the year."

Zohr, discovered by Eni in 2015, is the biggest gas field ever found in the Mediterranean, with an estimated 850B cm of gas in place; the approval process for development of the field was completed in February and first gas is expected by year-end 2017.