ADNOC Unit Considers Deal for Eni’s Libya Oil and Gas Assets

XRG, the international investment arm of Abu Dhabi National Oil Company (ADNOC), is in talks with Eni about potentially buying a stake in the Italian company’s oil and gas business in Libya, two people familiar with the matter said.

Negotiations are at an early stage and there is no certainty they will lead to a deal, the first person said.

XRG was established to pursue acquisitions in natural gas, chemicals and energy solutions, and aims to expand its liquefied natural gas capacity to between 20 million and 25 million tonnes a year by 2035.

The second person said XRG’s need to invest and grow outside the Persian Gulf region had become more pressing as the conflict between the US and Iran drags on.

Eni said it did not comment on rumours or speculation. XRG said it did not comment on market speculation.

Eni has operated in Libya since 1959. The country accounted for 162,000 barrels of oil equivalent per day of production last year, roughly 10 per cent of the Italian group’s total output.

Eni operates in Libya through Mellitah Oil Gas, a joint venture with Libya’s National Oil Corporation.

The Italian company recently announced the completion of the Bouri gas utilisation project, aimed at recovering associated gas from the offshore Bouri field in western Libya.

Eni is also developing the AE structures project, which is designed to bring new offshore gas resources on stream for domestic use and export.

Eni and XRG are already partners in a multibillion-dollar LNG project in Argentina being developed with state energy company YPF.