April 27 (Bloomberg) -- Eni SpA, Italy’s largest oil producer, reported a 13 percent gain in first-quarter profit after crude prices increased and Libyan output recovered.
Adjusted net income rose to 2.48 billion euros ($3.27 billion) from 2.22 billion euros a year earlier, the Rome-based company said today in a statement. That beat the 2.28 billion-euro average estimate of 14 analysts surveyed by Bloomberg.
“Eni expects to see Libyan production increase and reach plateau levels in the second half of 2012,” said Oswald Clint, an analyst at Sanford C. Bernstein & Co. in London. “Refining and chemicals again were loss making and the outlook remains poor for both businesses.”
Eni, the largest oil producer in Africa, began to restore output in Libya in September after shutting down operations during last year’s civil war that ended with the ousting of Muammar Qaddafi. It pumped 280,000 barrels of oil equivalent a day in the North African nation before the start of the unrest.
Daily output was little changed at 1.67 million barrels a day in the first quarter from 1.68 million barrels a year earlier. Operating profit for marketing almost tripled to 839 million euros after Eni renegotiated gas prices with OAO Gazprom.
“Recovery perspectives look poor in the gas sector with gas demand expected to be soft due to slow economic activity” Eni said. “Refining margins are anticipated to remain at unprofitable levels due to high costs of oil supplies, sluggish demand and excess capacity.”
Last month, Eni agreed to sell part of its 3.5 billion-euro stake in Galp Energia SGPS SA, Portugal’s largest oil producer. Scaroni has said the company doesn’t want to be a minority investor in Galp in the long term.
The Italian company doesn’t plan to sell any more Galp shares right now because “today’s market price doesn’t meet” its “minimal expectations,” Chief Financial Officer Alessandro Bernini told investors on a conference call. Galp shares rose as much as 5.1 percent in Lisbon trading.
Eni and OAO Rosneft, Russia’s biggest oil producer, this week agreed to explore for oil and gas in the Barents and Black seas and work together on projects outside Russia.
Last week, Eni started pumping hydrocarbons for the first time in Russia. Its $9.2 billion western Siberian gas venture with OAO Gazprom Neft and OAO Novatek is part of a plan to boost overall production by more than 3 percent a year through 2015.
Eni is preparing to sell its 5.9 billion-euro stake in Snam SpA, owner of Italy’s natural-gas distribution network, after the government ordered the spinoff to increase competition and reduce consumer prices.
It’s “too early” to talk about the details of the spinoff, said Bernini as he pledged to retain most of the proceeds from any future transaction to maintain liquidity.
Eni has also been exploring the waters off Mozambique, where it made the biggest gas discovery in the company’s history. Its total resource base in the East African nation now exceeds 40 trillion cubic feet. Eni has said it may sell some of its holdings next year after carrying out further appraisal.
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