Eni’s oil & natural gas production down y-o-y

Oil&Gas Materials 20 February 2021 11:03 (UTC +04:00)

BAKU, Azerbaijan, Feb.20

By Leman Zeynalova – Trend:

In the fourth quarter of 2020, oil and natural gas production by Italian Eni company averaged 1.713 million boe/d (1.733 million boe/d in the full year of 2020), a decrease of 11 percent compared to the fourth quarter of 2019 (down by 7 percent from the full year of 2019), Trend reports citing Eni.

Net of price effects, the decline was due to COVID19 effects and related OPEC+ production cuts as well as lower gas demand, mainly in Egypt. Production start-ups/ramp-ups in Algeria and Mexico, better contribution of Kazakhstan and portfolio contributions in Norway, were partly offset by the lower volumes in Libya driven by an anticipated contractual trigger, lower entitlements/spending and force majeure, as well as mature field declines.

Liquids production in the quarter was 809 kbbl/d, down by 13% from the fourth quarter 2019 (843 kbbl/d in the full year, down by 6 percent compared to the same period of 2019). The reduction in Libya, the effect of OPEC+ cuts, as well as mature field declines were partly offset by the contribution of portfolio activities and production growth in Mexico due to the ramp-up of Area 1, Angola for the start-up of Agogo, Congo due to the Nenè phase 2B start-up, Algeria and Kazakhstan.

Natural gas production in the quarter amounted to 4,800 mmcf/d, decreasing by 579 mmcf/d or by 11 percent y-o-y (4,729 mmcf/d in the full year, down by 11%). Lower production in Libya and the impact of lower natural gas demand in certain areas (mainly in Egypt), as well as lower LNG demand were partly offset by the growth in Algeria due to the start-up of the Berkine gas project and in Kazakhstan.

In 2020, net additions of proved reserves were 271 million boe relating to new discoveries, extensions and revisions of previous estimates. These additions drove an all-sources reserve replacement ratio of 43 percent. Net additions were impacted by unfavorable price effects (for 6 million boe) mainly due to a decreased Brent reference price for reserve estimation (41 $/barrel in 2020 compared to 63 $/barrel in 2019) driving downward revisions of reserves which became uneconomical in this environment and increased entitlements in certain PSAs.


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