Eni, Repsol To Invest $500 Mln Each To Develop Perla Field In Venezuela

(RTTNews) - Italian state-controlled oil and gas company Eni SpA (E) and Spanish oil company Repsol SA (REPYY) agreed Wednesday to invest $1 billion in the Perla Field in Venezuela, which is expected to start production by end-2014. The two companies will invest $500 million each to gain access to Perla's condensate reserves which are property of the Republic of Venezuela.

The strategic agreement related to investment was signed by the Venezuelan Minister of Petroleum and Mines and President of Petróleos de Venezuela S.A. or PdVSA Rafael Ramírez, Eni's CEO Claudio Descalzi, and Repsol President Antonio Brufau.

The agreement will see the creation of a new company to develop and produce Perla's condensate reserves. The new company will be jointly run by CVP (PdVSA's affiliate) with 60 percent participation, Eni with 20 percent and Repsol with 20 percent.

The production in the field, which begins in end-2014, will reach the peaks of 300 million standard cubic feet per day in Phase I, 800 million scfd in Phase II, and 1,200 million scfd in Phase III.

However, the agreement is subject to final contracts to be signed and to the approval of local authorities.

The Perla field in Venezuela is one of the largest worldwide discoveries of the last decade. It is located in the Cardón IV block in the Gulf of Venezuela, 50 kilometers from the shore in a water depth of 60 meters that was discovered in 2009.

The current estimate of gas in the Perla field is about 17 Trillion cubic feet (Tcf), or 3.1 billion barrels of oil equivalent.

The whole of Cardón IV block is licensed and operated by a joint operating company, Cardón IV S.A., which is 50 percent owned by Eni and 50 percent by Repsol.

Venezuelan state-run oil and gas company PdVSA has now exercised its right to buyback 35 percent ownership of the block, leaving the block jointly operated by Eni and Repsol also with 32.5 percent interest each.

Eni said its net production in Venezuela is currently about 10,500 barrels of oil per day through its participation in the Junín-5 heavy oil block and participation in PetroSucre, the operating company which runs the offshore Corocoro field.

E closed Wednesday's regular trading session at $50.80, down $0.57 or 1.11% on a volume of 86,914 shares.

In Milan, Eni shares closed at 18.62 euros, down 0.24 euros or 1.27% on a volume of 22.02 million shares. Repsol shares closed in Madrid at 20.11 euros, down 0.75 euros or 3.62% on a volume of 158.21 million shares.