International energy giant reportedly looking to offload Territory natural gas assets

ENI, the global Italian energy giant that supplies gas to Darwin for domestic power generation from the Blacktip Gas Project, is reportedly working with investment bank Citi to sell its Australian natural gas assets for around $1.6 billion.

Italian energy giant Eni is reportedly looking for a buyer for its Australian natural gas assets. Picture: Getty Images

ENI, the global Italian energy giant that supplies gas to Darwin for domestic power generation from the Blacktip Gas Project, is reportedly working with investment bank Citi to sell its Australian natural gas assets for around $1.6 billion.

Eni has offices in Darwin, Perth and Dili, in East Timor and began operations in Australia 20 years ago as part of its growth strategy for the South-East Asian region.

Overseas reports say the company, which also has major Territory solar projects in Katherine, Batchelor and Manton Dam, will launch its sale next week in a two-round process.

Northern Territory Resources Minister Paul Kirby was unperturbed by the news of an Eni sale. “Eni is one of a number of joint venture partners in the Bayu-Undan facility, the pipeline and the Darwin LNG plant,” Mr Kirby said.

“This is a commercial decision for Eni and we’re sure if the commercial arrangements change, we’ll forge strong relationships with the new partners.”

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The overseas report says the bulk of a sale would be linked to the Blacktip gas field and its attached Yelcherr gas plant, which has a long-term gas supply agreement with the Northern Territory Government’s Power and Water Corporation tied to it.

The Blacktip gas field is located 110km off the coast of Darwin in the Timor Sea’s Bonaparte Basin.

The Blacktip Yelcherr gas plant is located 12km southwest of Wadeye.

The report said it had not yet been decided whether the Katherine solar project Eni acquired last year, which has not yet started production, would be included in the sale.

Eni entered the Australian renewables market with the acquisition of the Northern Territory’s largest solar project – the 33.7MWp Katherine Solar Farm – from a joint venture set up by Australia’s Epuron and the UK-based Island Green Power.

The $40 million solar farm will be coupled with a 5.7MVA/2.9MWh battery storage system.

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Eni’s three Australian assets include an 11 per cent stake in ConocoPhillips’ Darwin LNG, which will soon be owned by Santos.

It is being reported that APA Group and Beach Energy have been targeted as potential buyers, along with infrastructure funds including IFM Investors and QIC.

The report said the Italian group has chosen to sell the assets to raise cash after the global downturn resulting from the coronavirus pandemic led to a sharp drop in oil prices.