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Eni moves into South African waters

Deal moves Italian company into frontier territory.
By Daniel J. Graeber Follow @dan_graeber Contact the Author   |   June 10, 2014 at 9:11 AM
| License Photo

MILAN, Italy, June 10 (UPI) -- Italian energy company Eni said Tuesday it was taking on an operator role on South Africa's coast after striking a deal with the country's Sasol Petroleum.

Eni acquired a 40 percent stake in 31,660 square miles of unexplored area along South Africa's east coast. The Italian company said the acquisition, made for an undisclosed sum, reinforces its position in frontier areas on the African continent.

South Africa is considered frontier territory for oil and gas exploration companies. It has few oil reserves of its own, with 15 million barrels of proved reserves. As of 2012, it produced about 180,000 barrels of oil per day. The country is a net importer of natural gas.

The Eni agreement is subject to the approval of the government of South Africa.

"The establishment of our partnership with Eni in respect of our offshore South African interests complements Sasol's strategy to develop sustainable energy solutions, which will serve to ensure all-important economic growth and development in southern Africa and the broader region," Sasol Ltd. Chief Executive Officer David Constable said in a separate statement.

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