Italian major Eni said it intends to expand in the Middle East after a spree of deals in the Gulf last year, pressing ahead with plans to reduce its reliance on Africa and oil and gas exploration.
Since last March Eni has secured nine deals in the United Arab Emirates, gained a foothold in Bahrain and expanded in Oman to underpin its future growth.
Last month it pledged $3.3 billion to buy part of the world’s fourth-biggest refinery in the UAE, increasing its own refining capacity overnight by more than a third.
Chief Executive Claudio Descalzi said on Friday there were huge opportunities to grow in the Gulf area and rebalance the group’s operational portfolio.
“It’s not finished, we’ve just started,” he told analysts on a conference call after its fourth-quarter results, adding long-term the group aimed to produce 100,000 barrels per day in the area.
Eni, which generates more than half its output in Africa, produced a record 1.851 million barrels of oil equivalent per day in 2018, lifted by operations in Egypt, Indonesia and Kazakhstan.
Giant gas discoveries in Mozambique and, more recently, Egypt have given the energy major the strongest discovery record in the industry, boosting its credentials with oil-producing nations.
“We’ll be able to enter new markets thanks to our technology and know-how,” Descalzi said.
The 63-year-old said that besides the Gulf Eni is also looking to Asia to boost its gas prospects as well as Alaska to increase its oil production.
“That’s a main oil target for us,” he said.
Eni said it had made a 470 million euro ($529.50 million) writedown on reserves in Venezuela where it has a 50 percent stake in the giant Perla gas field and 40 percent of the Junin 5 oilfield.
“Outstanding arrears with the country amount to about $700 million,” said CFO Massimo Monduzzi.
A deep economic and social crisis in Venezuela has seen output plummet and the recent move by Venezuela’s opposition to oust president Nicolas Maduro has made matters critical.
In the fourth quarter Eni’s adjusted net profit jumped 55 percent to 1.459 billion euros ($1.65 billion), above an analyst consensus forecast of 1.19 billion euros.
Free cash flow after dividends was the highest since 2006, with excess cash for the year of 3.8 billion euros.
Massimo Bonisoli, oil analyst at Milan-based broker Equita, said that the strong set of results showed the improvement in the group’s asset portfolio.
“The improvement of shareholders’ remuneration is likely through buy-back and some dividend increase in 2019,” he said in a note.
At 1419 GMT Eni shares were up 2.1 percent while the European oil and gas sector was up 1.2 percent.