Eni (NYSE: E) and BP (NYSE: BP) have announced that they have entered into a non-binding memorandum of understanding to progress detailed discussions on combining their upstream portfolios in Angola into a new joint venture.
The new company would be supported by Eni and BP but would be expected to be self funded. A business plan for the company would be agreed by Eni and BP to allow it to capture future opportunities in exploration, development, and possibly portfolio growth, both in Angola and regionally, the companies revealed.
Eni and BP are said to have appointed advisors that will support them in raising finance for the new joint venture. The companies have informed the Angolan Government of their intention and any final transaction will be subject to relevant governmental, regulatory, and partner approvals.
“The companies believe that combining their efforts in a new joint venture company would bring significant opportunities for them to jointly boost future developments and operations in Angola,” Eni and BP said in a joint statement.
“In particular, it would be expected to generate significant synergies, create more efficient operations and increase investment and growth in the basin. The new venture would reflect both companies’ commitment to continue developing the upstream sector potential of Angola,” the companies added in the statement.
In Angola, Eni is the operator of block 15/06, exploration blocks Cabinda North, Cabinda Centro, 1/14, and soon 28, and the New Gas Consortium (NGC). In addition, Eni has a stake in the non operated blocks 0 (Cabinda), 3/05, 3 / 05A, 14, 14 K / A-IMI, 15, and in Angola LNG. BP is the operator of Blocks 18 and 31 offshore Angola, and has non operated stakes in blocks 15, 17, 20, and soon 29. BP also has non operated interests in the NGC and Angola LNG.
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