BP, Eni Consider Combining Angolan Assets to Revive Output

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BP Plc and Eni SpA are considering merging their Angolan oil, gas and liquefied natural gas assets into a joint venture in a bid to revive output following years of decline.

The two energy giants have signed a non-binding agreement to discuss combining their upstream portfolios in the West African nation. That could be a boon to the country’s beleaguered oil industry, which has seen production slump by more than a third since 2015 amid chronic under-investment.

The companies’ Angolan assets together produce more than 200,000 barrels of oil equivalent a day, BP and Eni said in a statement on Wednesday. Merging them would bring “significant opportunities” to “boost future developments” and increase investment in the basin, they said.

The proposal is subject to governmental, regulatory and partner approvals. Vendors have been appointed to raise finance for the plans, the companies said, without providing further details.

Some of BP’s biggest finds in the past decade have been in Angola, but several of them -- such as the Katambi gas discovery -- were subsequently relinquished after the company determined they weren’t commercial.

The U.K. major operates offshore Blocks 18 and 31, and holds non-operated interests in additional blocks and in Angola LNG. Eni is the operator of the New Gas Consortium -- a joint venture that also includes BP -- and runs Block 15/06, as well as exploration licenses in Cabinda North and Cabinda Centro.

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