Eni Hints at Shell Tie-Up for Giant Gas Find in Mozambique

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LONDON - Eni SpA, Italy's biggest oil and natural-gas company by volume, hasn't had any formal sale talks to reduce its stake in a massive gas find in Mozambique, said the head of exploration and production Claudio Descalzi Thursday, adding rival Royal Dutch Shell PLC would be a perfect partner.

"Shell is one of our major partners worldwide...we always talk with Shell," said Mr. Descalzi at a press conference in London to detail Eni's upstream activities. "Shell could be a wonderful partner."

The Eni executive also said the company would be "comfortable" talking with Exxon Mobil Corp. on the sale of part of its 70% stake in an offshore Mozambique block.

Shell is the world's biggest shipper of liquefied natural gas and has extensive experience in developing the giant cooling systems needed to manufacture the fuel. The Anglo-Dutch giant attempted to buy into a neighbouring Mozambique license area earlier this year, but its attempted takeover of the license holder, Cove Energy, was unsuccessful.

However, Mr. Descalzi stressed it hadn't yet had formal talks on Mozambique with any other majors--neither Shell nor Exxon--stressing that Eni still had to resolve several key issues before such an engagement could go ahead.

Eni is in talks with Houston oil company Anadarko Petroleum Corp., whose own gas fields border Eni's, aimed at creating a shared development plan for their sizeable assets.

The talks have been mandated by the Mozambique government. Eni also still has to prove up the ultimate size of the gas fields at its disposal, Mr. Descalzi explained.

Eni's gas find in offshore Mozambique so far indicates a total potential of up to 70 trillion cubic feet--its largest find ever.

Copyright (c) 2012 Dow Jones & Company, Inc.

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