ENI (BURREN ENERGY PLC)
http://www.eni.it/en_IT/home.html
Company Information
In November 2007, ENI agreed to buy Burren Energy, an oil and exploration production company based in the UK, for 1.73 billion pounds ($3.6 billion).[i] With this purchase, ENI became the sole stakeholder and operator of the Nebit Dag block. ENI is an integrated energy company based in Italy.
Contact Information
Registered Head Office
Piazzale Enrico Mattei, n.1
00144 Rome, Italy
T: +39 06 598 21
F: +39 06 598 22141
Exploration and Production
Burren Resources Petroleum Limited
Archabil Shayoly 40
Berzengee
Balkanabat
History in Turkmenistan
Burren Energy signed a PSA with the government of Turkmenistan in August 1996 to develop Burun, the largest set of fields in the onshore Nebit Dag area. One of the most detailed sources for information on the project is archived excerpts from the now obsolete Burren Energy website.
The following is one such excerpt, summarizing the history of the project:
In 1995 Burren formed an alliance with Monument Oil & Gas Plc to acquire upstream projects in Turkmenistan which led to the signature of the Nebit Dag PSA in August 1996. Mobil joined the consortium later that year. The consortium of Monument (as operator), Mobil, and Burren initiated a rehabilitation and development programme on the Burun field–the western-most field in the Nebit Dag PSA area–which led to the commencement of oil exports in May 1998. Following the takeover of Monument in June 1999 and the merger of Mobil and Exxon in December 1999, the consortium partners decided that Nebit Dag was not of strategic importance to their businesses and Burren acquired their shares, becoming operator with a 100% shares in August 2000. On taking over operational control, Burren cut on-site overheads, administrative, and head office costs and terminated most subcontracting agreements, bringing these services in-house. These reductions in operating costs led to operations rapidly becoming cash-flow positive.
More detailed information on the PSA terms and the scope of Burren Energy’s operations is contained in the following 2005 excerpt from the Burren Energy website:
The Nebit Dag PSA area (1,050 km) is located onshore in western Turkmenistan and contains five developed oil and gas fields. Burren has production rights to the Burun field, at the western end of the area. The other four fields within the PSA area (Kyzl Kum, Kum Dag, Kara Tepe, and Nebit Dag) are operated by the state oil company Turkmenneft. Burren has exploration rights over the rest of the PSA area under an exploration license that expired in February 2007. The PSA term runs until 2022, and may be extended for a further 10 years by mutual agreement with the Turkmenistan government.
At the end of 2005, the Burun field was producing approximately 19,000 boepd (barrels of oil equivalent per day) from 135 wells. Development to date has been primarily on the northern flank of the field whilst the southern flank remains to be appraised. Prior to 2004, well activity consisted of workovers to return shut-in wells to production. Development drilling commenced in 2004. Average working interest production during 2005 increased by 35% to 15,410 boepd (2004: 11,430 boepd).”
Gas-lifts are now installed on most of the Burun field wells. Oil separation, treatment and storage facilities were upgraded during 2005. A pilot water injection scheme is expected to be implemented during 2006 which, if successful, will be rolled out across the field to provide reservoir pressure support and enhance oil recovery rates.
Exploration drilling outside Burun began in late 2005 and continued throughout 2006.
In April 2007, a delegation of Burren Energy’s top representatives traveled to Turkmenistan and met with President Berdymukhamedov to discuss the possibility for additional partnerships, including prospects for developing Turkmenistan’s offshore hydrocarbon reserves.[ii]
In October 2009, Berdymukhamedov met with ENI’s CEO, Paolo Scaroni, to discuss future collaboration. One month later, ENI signed a Memorandum of Understanding with the government of Turkmenistan to “promote and strengthen cooperation in the development of Turkmenistan’s petroleum industry.”[iii]
In 2009, ENI produced 12,000 bopd in Turkmenistan.[iv]
Berdymukhamedov again met with Scaroni in June 2010 to discuss expanding their collaboration.[v] It was reported in August 2010 that Berdymukhamedov had ordered that ENI be issued a new Production Sharing Agreement to further develop the Nebit Dag Field.[vi] In September 2010, Turkmenistan gave public support for an ENI project that would transport compressed natural gas via tanker across the Caspian Sea to Azerbaijan.[vii]
In March 2010, Scaroni proposed linking a portion of the proposed South Stream and Nabucco projects, namely a portion from Bulgaria to Austria, where the two routes would overlap. This suggestion came as support dwindled for the South Stream project, in which ENI plays a “key technological and commercial” role, and the Nabucco proposal is gaining strength.[viii] However, in January 2011, Scaroni retracted his proposed merger, asserting that the Nabucco project is behind schedule, making it “impossible to have synergies with something that doesn’t exist.”[ix]
Yet another meeting occurred between Eni leadership, this time CEO Claudio Descalzi, and Berdymukhamedov in July 2014. The two discussed ENI’s continued role in Turkmenistan, as well as the company’s interest in offshore facilities.[x] Seemingly culminating in an addendum to the PSA in November 2014, overseen by the Italian Prime Minister in the first visit to Turkmenistan by a western Head of State. [xi] The PSA was extended to 2032, with 10% stake of the Nebit Dag area given to Turkmenneft. In a “separate” meeting, ENI and the Turkmen State Agency for Management and Use of Hydrocarbon Resources signed a Memorandum of Understanding to explore ENI’s possible operations in the Turkmenistan Caspian offshore sector.[xii] ENI’s head and Bedymukhamedov met once again in November of 2019 during a visit to Italy, attended by several Italian companies including Danieli, Leonardo SpA, Maire Tecnimont, Valvitalia, Thales Alenia Space, Bonatti, SACE, and Pietro Fiorentini.[xiii] According to the US Department of State[xiv], offshore blocks 19 and 20 are currently operated by ENI, indicating that the 2014 memorandum resulted in more than just ‘exploration’.
Current Scope of Operations
ENI was a gold (2010, 2012) and bronze (2019) sponsor of the Turkmenistan International Oil and Gas Conference.[xv]
———————————————————————————————–
[i] Tom Bergin, “ENI to Buy Burren Energy for 1.7 bln,” Reuters, Nov. 30, 2007, http://uk.reuters.com/article/businessNews/idUKWLB393820071130. Accessed February 17, 2022.
[ii] Turkmenistan.ru “Gurbanguly Berdimuhammedov Receives Top Managers of Burren Energy Company,” Apr. 27, 2007, http://www.turkmenistan.ru/en/node/5591#:~:text=Turkmen%20President%20Gurbanguly%20Berdimuhammedov%20received,Turkmenistan%2C%20Mohammed%20Akhtar%20Hussein%20 Sharif. Accessed February 17, 2022.
[iii] ENI, “Eni Signs a Cooperation Agreement with the Republic of Turkmenistan,” Nov. 25, 2009, http://www.eni.com/en_IT/media/press-releases/2009/11/2009-11-25-Eni-signs-cooperation-agreement-Republic-Turkmenistan.shtml. Original weblink no longer active.
[iv] ENI, ENI in the World: Turkmenistan, http://www.eni.com/en_IT/eni-world/eni-world.shtml?navint=azienda. Original weblink no longer active.
[v] ENI, “Eni: CEO Paolo Scaroni Mt with President Gurbanguly Berdimukhamedov of Turkmenistan,” Jun. 2, 2010, http://www.eni.com/en_IT/media/press-releases/2010/06/02-06-2010-scaroni-met-gurbanguly.shtml?menu2=media-archive&menu3=press-releases. Original weblink no longer active.
[vi] Catherine A. Fitzpatrick, “Turkmenistan Weekly Roundup,” Eurasianet.org. Aug. 24, 2010, https://eurasianet.org/turkmenistan-weekly-roundup-6. Accessed February 17, 2022.
[vii] Staffetta News, “Natural Gas, Turkmenistan in Favor of ENI’s CNG Project,” Sept. 23, 2010, http://www.staffettaonline.com/staffetta_news/articolo.aspx?ID=10097. Original weblink no longer active.
[viii] Socor (March 17, 2010).
[ix] Migliaccio (January 10, 2011).
[x] ENI, “Turkmenistan President Gurbanguly Berdimuhammedov receives Eni CEO Claudio Descalzi,” https://www.eni.com/en-IT/media/press-release/2014/07/turkmenistan-president-gurbanguly-berdimuhammedov-receives-eni-ceo-claudio-descalzi.html. Accessed November 23, 2021.
[xi] AGI, “Italian premier makes ‘historic’ visit to Turkmenistan,” November 17, 2014, https://www.agi.it/innovazione/italian_premier_makes_historic_visit_to_turkmenistan-139204/news/2014-11-17/. Accessed February 8, 2022.
[xii] ENI, “Eni strengthens its presence in Turkmenistan,” https://www.eni.com/en-IT/media/press-release/2014/11/eni-strengthens-its-presence-in-turkmenistan.html. Accessed November 23, 2021.
[xiii] Business Turkmenistan, “Italian Businesses Propose New Areas of Cooperation to Turkmen President,” November 8, 2019, https://business.com.tm/post/4632/italian-businesses-propose-new-areas-of-cooperation-to-turkmen-president. Accessed February 8, 2022.
[xiv] US Department of State, “2021 Investment Climate Statements: Turkmenistan,” https://www.state.gov/reports/2021-investment-climate-statements/turkmenistan. Accessed November 23, 2021.
[xv] 17th Turkmenistan International Oil and Gas Conference, “Sponsors,” Turkmenistan International Oil and Gas Conference; http://www.oilgasturkmenistan.com/sponsors. Original weblink no longer active.