Italy’s oil and gas giant, Eni SpA (E) has made a huge discovery of over 250 feet of net pay in the Emry Deep IX well in Egypt’s Western Desert.
Located 290 kilometers south west of Alexandria in the Meleiha Concession, the Emry Deep well was drilled to a total depth of 3,628 meters. Eni came across the net pay in multiple good quality sandstones of the Lower Cretaceous “Alam El Bueib” Formation.
During production tests, the well released 3,500 barrels of 41-degree oil and 1 million standard cubic feet of associated gas per day.
Per the recent estimations, the prospect is expected to hold 150 to 250 million barrels of oil reserves. Further appraisal drilling is required to be carried out in the exploration well.
The drilling in this region forms a part of Eni’s strategy focus on transforming its exploration activities in Egypt, Mediterranean and Sinai regions by seeking deeper plays.
Eni expects to yield about 10,000 barrels of oil per day from the full field, once the additional development wells are drilled. The production will then be routed to the treatment facilities of Meleiha field, which is in close proximity to the prospect.
Eni’s wholly owned Egyptian subsidiary, International Egyptian Oil Company (IEOC), owns a 40% interest in the joint operating company – Agiba – that retains the operatorship of the Emry Deep. Egypt General Petroleum Corporation and Mitsui are the other stakeholders with 50% and 10% interest, respectively.
Eni’s Egyptian subsidiary has a 56% working interest in the Meleiha Concession. Whereas, Russia’s Lukoil and Japan’s Mitsui hold 24% and 20% interest in it.
Currently, Eni generates approximately 36,000 barrels of oil equivalent from five different development leases in the Western Desert on a daily basis. All these leases are operated by Agiba.
Eni holds a Zacks #3 Rank, which is equivalent to a Hold rating for a period of one to three months. For the long term, we maintain a Neutral recommendation on the stock. Eni faces competition from Statoil ASA (STO).
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