Italy's ENI shares firm after Kashagan deal

MILAN/LONDON, Jan 14 (Reuters) - Shares in Italian oil major Eni (ENI.MI) traded slightly higher on Monday after the company agreed a settlement in its dispute with Kazakhstan over the giant Kashagan field.

ENI shares were up 0.2 percent at 25.07 euros at 0910 GMT compared with a 0.1 percent rise in the DJ Stoxx European oil and gas sector index .SXEP.

Kazakh state oil company KazMunaiGas [KMG.UL] said on Sunday the Eni-led consortium developing Kashagan had agreed to allow KMG to double its stake in the field to 16.51 percent, with members giving up a pro-rata portion of their stake.

The Wall Street Journal reported on Monday that KazMunaiGas would pay $1.78 billion for the increased stake and that the consortium also agreed to make an additional payment to the state of $2.5 billion to $4.5 billion, depending on the price of oil.

The payment includes a one-off bonus of $300 million, with the rest comprising a royalty, the newspaper said.

Other shareholders in the field are Royal Dutch Shell (RDSa.L), Exxon Mobil (XOM.N), France's Total (TOTF.PA), Japan's Inpex (1605.T) and ConocoPhillips (COP.N).

In a research report, Credit Suisse said: "We believe this uncertainty has been hanging over Eni's shares for some time, down 6 percent (relative) over the last six months. We see this as a line in the sand for Eni."

The brokerage said it remained neutral on Eni shares.

Italy's Corriere della Sera newspaper reported that once the initial development phase was over, expected in 2010 to 2011, Eni would share operations of the field in a joint venture with Total, Exxon Mobil and Royal Dutch Shell. (Reporting by Ian Simpson in Milan and Tom Bergin in London; Editing by David Holmes)