The purchase price includes consideration of $1.125 billion and the pro quota reimbursement of past expenditures that amounts to $450 million. Rosneft also has the option to buy an additional 5% stake under the same terms.
Eni, through its subsidiary IEOC Production BV, currently holds 90% interest in the block following the recently agreed upon sale of 10% to BP PLC (OGJ Online, Nov. 28, 2016).
“This agreement further confirms the success of Eni’s dual exploration model, which, in parallel with an accelerated development of the hydrocarbons reserves, aims at early monetization of the value through the dilution of the high participating interest owned in huge exploration discoveries,” the Italian multinational firm said. The model has generated $6.3 billion in cash over the last 4 years.
Just this month, Rosneft agreed to sell 19.5% interest in itself to Glencore PLC and Qatar’s sovereign wealth fund for €10.2 billion (OGJ Online, Dec. 9, 2016).
Zohr field, discovered by Eni in August 2015, holds an estimated 850 billion cu m of gas in place. Production is expected by yearend 2017.