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January 3, 2020updated 09 Jan 2020 11:51am

Bahrain approves oil deal with Italy’s Eni

By MEED   

Bahrain’s Shura Council, the upper house of the National Assembly, has approved an oil exploration and production agreement between the country’s National Oil & Gas Authority (Noga) and Italy’s Eni.

Eni announced that it had signed an exploration and production-sharing agreement (EPSA) for Block 1 offshore Bahrain on 1 May this year.

The deal followed a joint study conducted by Eni in 2016 and a memorandum of understanding (MoU) agreement, which was signed on 13 January 2019.

Under the terms of the agreement, Eni will pursue exploration activities in the offshore area of more than 2,800 square kilometres, located in the northern territorial waters of Bahrain, with water depth ranging from ten metres up to 70 metres.

The deal will allow Eni to invest in exploring the country’s recently discovered Khalij al-Bahraini field.

Bahrain’s Council of Representatives approved the agreement in November.

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The first exploratory well is due to be drilled in the first quarter of 2020.

Under the terms of the deal, Bahrain will receive an initial $2m as production starts at the oil and gas field off the northern coast.

Bahrain announced the discovery of the Khalij al-Bahraini oil field in April 2018.

Officials said the oil field contains up to 80 billion barrels of tight oil, dwarfing the Gulf island kingdom’s current reserves.

Appraisals of the offshore Khalij al-Bahraini basin by two US firms also suggest the presence of 280 billion to 560 billion cubic metres of natural gas.

Before the discovery, Bahrain had proven crude reserves of just 125 million barrels and 92 billion cubic metres of natural gas.

This article is published by MEED, the world’s leading source of business intelligence about the Middle East. MEED provides exclusive news, data and analysis on the Middle East every day. For access to MEED’s Middle East business intelligence, subscribe here.

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