Eni Expands in Gas-rich Turkmenistan

Eni's Caspian blocks are rich in oil, gas; Eni is a key player in neighbor Kazakhstan's oil sector.

Italian oil and gas major Eni has agreed a series of deals with Turkmenistan to expand its operations in the gas-rich country as it turns increasing attention eastwards to drive growth.

Eni said it had extended an onshore production sharing agreement (PSA) with the Central Asian state. It is also exploring offshore opportunities, the Italian company said on Tuesday.

Turkmenistan sits on the world's fourth-largest reserves of natural gas and rising exports to China have powered its economic growth.

Under CEO Claudio Descalzi, ENI has stepped up efforts to shift the focus to finding oil and gas, announcing plans to grow in Asia to both help sell the gas it produces and develop upstream gas exploration.

"We have come to a conclusion that there must be an active investment ideology present in our countries' relations," Turkmen President Kurbanguly Berdymukhamedov told journalists in the Turkmen capital Ashgabat after the signing ceremony with visiting Italian Prime Minister Matteo Renzi.

Eni, which started its activities in Turkmenistan with the purchase of British company Burren Energy Plc in 2008, has said the country has "high exploration upside".

Berdymukhamedov said Eni would prospect for hydrocarbons on Blocks 19 and 20 in the Turkmen sector of the Caspian Sea shelf.

"Geological resources here stand at 510 million tonnes of oil and 630 billion cubic metres of natural gas," he said, without elaborating.

The PSA for the Nebit Dag area block had been extended to February 2032, Eni said, adding it had transferred a 10 percent stake in the block to Turkmen state-owned oil company Turkmenneft.

In Turkmenistan's ex-Soviet neighbour Kazakhstan, Eni is a joint operator of the Karachaganak oil and gas condensate project with Britain's BG Group, and holds a sizeable stake in the Kashagan offshore project in the Caspian, the world's biggest oil find in recent times.
 

By Stephen Jewkes and Marat Gurt