Eni and bp finalise agreement to create new independent joint venture in Angola

Source: press release, 11 March 2022

Eni has been present in the Angola since 1980
Eni has been present in the Angola since 1980 (photo: Eni)

bp and Eni have confirmed that they have signed an agreement to form a new 50/50 independent company, Azule Energy [a bp and Eni Company], through the combination of the two companies’ Angolan businesses. The agreement follows the memorandum of understanding between the companies agreed in May 2021.

Azule Energy will be a new international energy company, independently managed, with more than 200,000 barrels equivalent a day (boe/d) of net oil and gas production and 2 billion barrels equivalent of net resources. It is expected to be Angola’s largest producer, holding stakes in 16 licences, as well as participating in the Angola LNG joint venture. Azule Energy will also take over Eni’s stake in Solenova, a solar company jointly held with Sonangol.

Azule Energy will have a strong pipeline of new projects starting up over the next few years, including the new Agogo and PAJ oil projects in Blocks 15/06 and 31 respectively. It will also develop the New Gas Consortium (NGC), the first non-associated gas project in the country, which will support the energy needs of Angola’s growing economy, its decarbonisation path and strengthen its role as a global LNG player.

bp and Eni share common goals for Azule in achieving environmental and sustainability ambitions.

bp and Eni believe combining their efforts with a long-term perspective will create more efficient operations and offer the potential for increased investment, job creation and growth in Angola. Azule Energy will continue to develop the full potential of the country’s upstream sector, while also positioning itself to capture new opportunities from the energy transition with the growing role of gas and renewables in its portfolio.

Bernard Looney, bp’s chief executive, says, “Angola has long been important for bp operations and this innovative new venture underscores and enables our continued commitment to the country. Eni is a valued partner to be working with in the region. Azule Energy draws on our combined strengths and skills and, more importantly, is anchored in our shared values and beliefs about what the future of energy should be. Ultimately Azule Energy will be able to drive efficiencies and realise new opportunities across an expanded and truly exciting portfolio.”

Claudio Descalzi, CEO of Eni, says, “The creation of Azule Energy is a further step in advancing our strategic approach to accelerate growth through focused lean and financially independent companies. Combining two world-class businesses into one stronger team, Azule Energy will leverage synergies and high-quality assets, boosting activities in Angola and will have one of the largest portfolios of production, development and exploration opportunities in Sub-Saharan Africa. bp shares our values and our approach to just transition and we are very pleased to be partners in this initiative.”

Health, safety and environmental performance, project delivery and production efficiency will be priority areas for the new venture. The joint venture will maintain access to world-class technologies and best practices through focused areas of technical support from Eni and bp. Azule Energy will continue bp and Eni’s social investment commitments in Angola.

Since announcing the intent to form the JV in May 2021, bp and Eni have worked closely with the Angolan government and the creation of Azule Energy will be subject to all customary governmental and other approvals, with the aim of completing the transaction in the second half of 2022. Once set up, Azule Energy will be equity accounted by bp and Eni. Hydrocarbon production and GHG emissions will continue to be reported on an equity share basis.

Currently Eni is operator of Blocks 15/06 Cabinda North, Cabinda Centro, 1/14, 28 and soon NGC. In addition, Eni has a stake in the non-operated blocks 0 (Cabinda), 3/05, 3/05A, 14, 14 K/A-IMI, 15 and in Angola LNG.

bp is operator of Blocks 18 and 31 offshore Angola, and has non-operated stakes in blocks 15, 17, 20 and 29. bp also has non-operated interests in NGC and Angola LNG.