October 30, 2012 / 8:13 AM / 7 years ago

UPDATE 2-Eni profit helped by Libya recovery

* Q3 adj net from continuing ops 1.78 bln euros

* Eni sees full-year production above 2011

* Eyeing gas sale drive in France, Germany, Austria (Recasts, adds detail, CFO comment)

MILAN, Oct 30 (Reuters) - Italian oil and gas group Eni reported a better-than-expected rise in quarterly profit thanks to a recovery in Libya, and said it was looking to Africa to underpin its growth goals.

Over the past year, Eni has gone some way to dispelling scepticism about its profitability and growth potential by sealing a deal with Russia’s Rosneft and scoring exploration successes in Norway as well as Africa.

Eni said it expected production for the full year to be higher than the previous year when it stood at just under 1.7 million barrels per day, as Libyan production returns to levels seen before the conflict there.

The group is the biggest foreign operator in Libya.

Eni, the world’s No. 7 oil company in terms of production, expects Africa will help achieve its goal of a rise in oil and gas production of around 3 percent per year.

“Our business is increasingly focused on exploration and production,” Bernini told analysts in a conference call on third quarter results.

The group’s jumbo gas find in Mozambique, which has more than 70 trillion cubic feet of gas in place, has drawn great interest from majors keen to get a piece of the action.

Adjusted net profit in the third quarter from continuing operations came in at 1.78 billion euros ($2.31 billion), above a Reuters poll of 1.618 billion euros.


The result was boosted by a 1.15 billion-euro-gain from the sale of a 5 percent stake in Galp. Investors had been looking for news of a possible sale of the residual stake.

“We received a lot of interest (for Galp) from financial institutions,” said Eni CFO Alessandro Bernini on Tuesday. “The offer prices did not satisfy Eni’s minumum expectations.”

The state-controlled Italian oil company, which had committed to sell its Galp stake by the end of 2013, has previously said it wants an overall 3.5 billion euros.

Divorce from gas grid company Snam had given Eni all the muscle it needed to fund its new focus on upstream growth, Bernini said.

A deal earlier this month to sell just under 30 percent of Snam is set to lighten Eni’s debt pile by 14.7 billion euros and raise cash of 3.5 billion euros. ($1 = 0.7705 euros) (Reporting By Stephen Jewkes; Editing by Helen Massy-Beresford and Louise Heavens)

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