Eni SpA E announced successful testing of the Tecoalli-2 well, located in the shallow waters of the Campeche Bay, offshore Mexico.
The well is located in Contractual Area 1, about 200 kilometer West of Ciudad del Carmen and in water depth of 33 meter. It confirms the excellent production capabilities of the Orca formation during the production test. Per the company, the oil encountered in this reservoir was of superior quality.
During the test, the well attained a flow rate of 7000 barrels of oil per day (BOPD), restricted by the capacity of the production equipment. On completion of the final production, the well is estimated to attain 10000 BOPD.
The results of the well along with the modifications to the reservoir models of the Amoca and Miztón fields have raised the estimate of the hydrocarbon in place for Area 1 to 2 billion barrels (Bboe). This includes about 90% of oil, while the rest is associated gas.
The Tecoalli-2 well is likely to be abandoned temporarily. It will be recovered as a production well for future development of this field. After receiving approval from the authorities, Eni will endorse the development (FID) of Area 1 (Amoca, Miztón and Tecoalli fields). The production is anticipated to commence in first half of 2019.
Eni’s presence in Mexico dates back to 2006. In 2015, the company established its wholly-owned subsidiary — Eni Mexico S. de R.L. de C.V. Eni has operatorship of four exploration and production blocks in the Sureste Basin — Area 1 with 100% ownership; Block 7, where Eni holds 45%; Block 10 with 100% ownership; and Block 14 where Eni holds 60%.
Price Performance
The company’s shares have gained 1.5% compared with the industry’s rally of 6.5% in the last three months..jpg)
Zacks Rank & Key Picks
Eni currently carries a Zacks Rank #3 (Hold). Some better-ranked players in the energy sector include Holly Energy Partners, LP HEP, HollyFrontier Corporation HFC, and Northern Oil and Gas Inc NOG. All these stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Holly Energy Partners, owner and operator of refined product pipelines and terminals, delivered an average positive earnings surprise of 57.14% over the trailing four quarters.
Headquartered in Dallas, TX, HollyFrontier is involved in refining of the petroleum. The company delivered an average positive earnings surprise of 8.04% in the last four quarters.
Northern Oil and Gas, based in Minnetonka, MN, is an independent energy company. The company delivered an average positive earnings surprise of 175.00% during the same time frame.
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