Neptune Energy, a leading international independent E&P company and one of Europe’s largest independent exploration and production companies, is involved in acquisition talks with Italian energy firm ENI, in which the latter has improved on a previous offer of below $6 billion.

The two oil giants began a new stage of exclusive discussions recently after months of slow-moving negotiations. The Italian energy firm has agreed to up its initial offer and is now willing to spend between$5 billion to $6bn, reports say.

Talks have been going ahead with progress being made, however, a takeover is not set in stone, according to reports.

Neptune is owned by China Investment Corporation (CIC), the Carlyle Group (CG.O) and CVC Capital Partners. In recent weeks Neptune Energy announced first gas production from its Adorf Z17 onshore gas well in Germany.

Located in Georgsdorf, north-western Germany, the Z17 well taps the Carboniferous formation and is expected to output around 1,800 barrels of oil equivalent per day (boepd).

Dedicated Processing Plant for Gas Treatment Completed

The new stream takes total production from the Adorf licence to around 6,300 boepd. A dedicated processing plant at the site for gas treatment was also completed earlier this year.

In the first quarter of 2023, Neptune reported production of around 142,000 barrels of oil equivalent per day (boepd) of which three-quarters is gas.

Neptune has operations in Norway, the UK, Indonesia, Algeria, the Netherlands and other countries, and is backed by China Investment Corporation, and funds advised by Carlyle Group and CVC Capital Partners.

In March 2023, Bloomberg reported that Neptune’s owners were working with advisers including Goldman Sachs Group and Rothschild & Co. to gauge options for the company, including a potential sale.

Earlier this year, Neptune and its partners, Vår Energi, Sval Energi and DNO, started production from the Fenja oil and gas field offshore Norway.

Located 120km north of Kristiansund at a water depth of 325m, the Fenja field is expected to have a production capacity of 35,000boepd gross.

Eni, meanwhile, posted a first-quarter profit that beat estimates on strong gas trading, but trimmed its full-year earnings guidance due to lower prices for the fuel.

The Italian oil and gas firm said it expects 2023 adjusted operating profit to be €12 billion ($13.2 billion).

This is down from the previous guidance of €13 billion. Cash flow from operations was trimmed by roughly the same amount to €16 billion.

Chief Executive Officer Claudio Descalzi said in his firm’s first quarter, “Eni has delivered an excellent set of operating and financial results despite a weakening scenario”.

“We remain financially disciplined as a necessity to meet the challenges of the energy market and deliver value for our shareholders.”
Claudio Descalzi