December 20, 2019 / 6:57 PM / a month ago

Italy's Eni signs Albanian crude deal for Dumre Block

TIRANA, Dec 20 (Reuters) - Italy’s Eni has signed an exploration and output-sharing deal with 100% equity interest with Albania on Friday for the Dumre block in the centre of the Balkan state.

Eni was among other oil majors to enter Albania after the fall of communism in 1990, but left the country in 1999 after drilling three commercially non-viable wells in two offshore blocks in the Adriatic Sea between Albania and Italy.

Interest in Albanian crude grew after Royal Dutch Shell began drilling some five years ago to make a significant discovery with a “a flow potential of several thousand barrels of oil per day” at Shpirag in central Albania, just below Dumre.

“The new entry after 20 years in Albania, in the Dumre Block, represents a very important step for Eni, which is committed...to help developing a key country of the Balkan region and Italy’s strategic partner,” said ENI CEO Claudio Descalzi.

The Dumre Block covers an area of 587 square kilometres and is located approximately 40 km south of the capital Tirana, in a “proven” hydrocarbon area, Eni said in a statement.

“With the award of Dumre Block, Eni, which is the operator through the new subsidiary Eni Albania, took the commitment to drill an exploration well...,” the statement added.

Belinda Balluku, the Energy Minister who signed the contract with Descalzi, said the benefits for Albania were higher compared with previous contracts, but neither side gave details.

“Currently private investments in exploration for crude and gas have reached $1.5 billion dollars and Eni’s ambitious programme will help increase that volume,” she added. (Reporting by Benet Koleka, editing by Louise Heavens)

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