Qatar Petroleum Buys Oil Stakes From Eni

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Qatar petroleum signage
An attendee passes in front of Qatar Petroleum illuminated signage during the 2018 Offshore Technology Conference (OTC) in Houston, Texas, U.S., on Monday, April 30, 2018. The OTC gathers energy professionals to exchange ideas and opinions to advance scientific and technical knowledge for offshore resources. Photographer: Aaron M. Sprecher/Bloomberg

Qatar Petroleum is buying stakes in three offshore oil blocks in Mexico from Eni SpA, as the Arab country signs another global expansion deal after leaving OPEC.

Eni and the government-owned energy company in Qatar, the world’s biggest exporter of liquefied natural gas, will produce about 90,000 barrels of oil a day from the Amoca, Mizton and Tecoalli fields in the Gulf of Mexico by the end of 2021, Saad Sherida Al Kaabi, Qatar’s energy minister, said in Doha. The fields hold 2 billion barrels of oil equivalent, he said at a press conference with Eni Chief Executive Officer Claudio Descalzi.

The companies are already working together on a separate offshore block in Mexico, according to press releases from both companies. Eni gained approval for the developments earlier this year and needs the Mexican authorities to sign off on Sunday’s deal.

Global oil majors that have for years produced in U.S. waters are being attracted to the Mexican side of the Gulf as the government opens new blocks for development. Middle Eastern producers are exploring opportunities for offshore developments in the Americas and Africa as well as looking at prospects for shale oil developments in the U.S. Growing production from outside OPEC is challenging the producers’ group.

Read more: Qatar to Leave OPEC

Qatar Petroleum is now operating in Mexico, Brazil, Argentina, Oman, Congo, South Africa, Cyprus and Mozambique. The Middle Eastern country, which has been facing a blockade led by OPEC members Saudi Arabia and the United Arab Emirates, said this month it was leaving the Organization of Petroleum Exporting Countries to focus on its gas business.

Last week, Qatar Petroleum agreed to acquire a stake in a Mozambique energy project. The company is exploring for oil and gas in Cyprus, Argentina, Morocco and other countries. It plans to pump $20 billion in U.S. fields and will expand its local LNG output by 43 percent to 110 million tons per year in 2025.

Eni has made offshore discoveries from the Americas to Africa and the Mediterranean. The Rome-based company has ceded stakes in natural gas fields in Egypt to BP Plc and Mubadala Investment Co. and is working with Russia’s Lukoil PJSC in Mexico.

Eni, which this year won rights to develop crude and gas deposits in Abu Dhabi, also wants to partner in LNG expansion projects in Qatar, Descalzi said. Qatar isn’t worried that Australia became the world’s top LNG producer as the Arab country will regain the No. 1 position after completing expansion projects, Al Kaabi said.