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Eni wants to be part of oil exploration in Timor with Portugal’s Galp

Lusa, 18 July 2006

Lisbon, Portugal, 18 July ­ Italian oil company Eni wants Portugal’s Galp, of which it owns a third of the capital, to be part of the consortium that will explore for oil in the Timor Sea, with a 10 to 20 percent stake.

In an interview with Portuguese financial daily Diário Económico, the chairman of Eni, Paolo Scaroni, said that the proposal to be part of the consortium, which will explore two blocs, will be put to Galp soon, and the size of the stake would be established later.

The Italian manager said that the participation of Galp, which put forward a proposal in partnership with Brazil's Petrobras for two auctioned blocs, but was defeated in the tender, was a way of reducing the risk associated to the research and exploration phase.

For the seismic survey of the two blocs alone, the Portuguese company would have to invest around US$40 million, Scaroni said.

Sacroni also said that the “invitation” would not be extended wither to Petrobras, which had 35 percent of the defeated consortium, or Malaysia’s Petronas, which was consortium leader with 40 percent.

In May, Eni won the tender for five blocs in the Timor Sea, located in deep water areas.

For bloc C, which was competed for by Galp, Eni paid US$4.5 million, or 4.5 times the offer put forward by the Portuguese oil company.

The exploration contracts were signed in June with the Timorese government, which will receive part of the exploration revenue.

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