Vitol to acquire stakes in Eni’s West African energy assets for $1.65bn

Vitol, one of the world’s largest independent energy traders, has agreed to acquire stakes in key oil and gas assets from Italian multinational Eni in a transaction worth $1.65 billion. The deal, which involves producing and exploratory assets in Côte d’Ivoire and the Republic of Congo, signals a strategic shift in both companies’ upstream portfolios and highlights the evolving role of West Africa in global energy supply.

This acquisition grants Vitol a 30% interest in Côte d’Ivoire’s Baleine project, where Eni currently holds a dominant 77.25% stake, and a 25% interest in the Congo LNG project, reducing Eni’s current 65% ownership in the development. The two companies, already partners in Ghana’s Offshore Cape Three Points (OCTP) project and Block 4, are further strengthening their cooperation in the region.

The transaction follows Eni’s broader strategy of portfolio rebalancing, allowing the company to monetize assets early while maintaining an operational presence in key energy markets. For Vitol, which has long been active in West Africa’s energy sector, the acquisition expands its upstream footprint, complementing its existing infrastructure and trading operations.

Why Is Eni Reducing Its Stake In These Oil And Gas Projects?

Eni’s decision to divest part of its holdings in these projects aligns with its “dual exploration model,” which focuses on early monetization of discoveries through strategic partnerships. This approach allows the company to generate capital while maintaining operational influence in high-value projects.

With a long history in Africa’s energy sector, Eni has prioritized high-efficiency, low-carbon production models to support its long-term sustainability goals. By reducing its stakes in the Baleine project and Congo LNG, the company can reallocate resources to other high-potential ventures while ensuring these projects continue to receive investment and expertise from a strong industry partner like Vitol.

This strategy is particularly relevant as energy companies face increasing pressure to balance hydrocarbon development with net-zero ambitions. While oil and gas remain essential to global energy security, firms like Eni are actively seeking ways to optimize operations while reducing carbon intensity.

What Makes The Baleine Project A Game-Changer For Côte d’Ivoire?

Baleine, discovered by Eni in 2021, stands as Côte d’Ivoire’s largest oil and gas find in two decades and is also Africa’s first net-zero upstream project. The discovery came at a crucial time when the country sought to enhance its domestic energy security and reduce dependence on imports.

Since production began in 2023, Baleine has exceeded 60,000 barrels of oil equivalent per day (boe/d). With Phase 3 currently under study, the project is expected to ramp up production to 150,000 barrels of oil per day and 200 million cubic feet of gas per day. Unlike many oil projects where associated gas is flared or exported, Baleine’s gas output is entirely designated for domestic energy supply, reinforcing Côte d’Ivoire’s ambition to become a regional energy hub.

For Vitol, a company traditionally focused on trading and downstream operations, acquiring a stake in Baleine presents a strategic opportunity to expand its presence in oil production while integrating upstream and midstream operations.

How Will The Congo LNG Project Impact Global Gas Supply?

In the Republic of Congo, Congo LNG is a transformative project that has positioned the country among the world’s emerging liquefied natural gas (LNG) exporters. The project, which began LNG shipments in February 2024, is set to expand its production capacity significantly.

Currently, Congo LNG produces 1 billion cubic meters (BCM) of gas annually. A planned second phase, slated to launch by late 2025, will increase output to 4.5 BCM per year, making it one of Africa’s most significant LNG export projects.

LNG demand has surged in recent years, particularly in Europe and Asia, as markets seek to diversify supply chains in response to geopolitical tensions and energy security concerns. With Vitol acquiring a 25% interest, the project stands to benefit from greater financial backing, trading expertise, and access to global LNG markets.

This deal also reinforces the growing role of West African gas in the global energy transition. As European nations shift away from Russian gas and look for reliable alternative suppliers, projects like Congo LNG could play a pivotal role in meeting demand while fostering regional economic growth.

What Are The Next Steps For Eni And Vitol?

The transaction is expected to be finalized once regulatory approvals from the governments of Côte d’Ivoire and the Republic of Congo are secured. Given the strategic importance of these energy assets, both parties anticipate a swift closure, ensuring operational continuity and further investment in project development.

For Eni, this move represents a financially strategic divestment that allows the company to strengthen its capital efficiency while maintaining exposure to high-growth energy assets. The capital generated from this sale could be redirected toward other exploration and production ventures, including its expanding footprint in carbon capture, renewable energy, and sustainable fuel production.

For Vitol, the acquisition reinforces its shift toward long-term production assets, complementing its existing trading and infrastructure operations. By securing a stake in two of West Africa’s most promising projects, the company is positioning itself as a leading player in both oil and LNG markets.

What Does This Mean For Investors?

As a publicly traded company, Eni S.p.A. (NYSE: E) has seen mixed investor sentiment following this announcement. Analysts remain cautiously optimistic, with a consensus “Hold” rating reflecting uncertainty over the long-term impact of this divestment.

Recent stock performance:

Eni shares are currently trading at $31.47, with analysts projecting an upside. MarketWatch reports an average price target of $34.28, suggesting a potential increase of 8.9%. MarketBeat supports a neutral investment outlook, citing three buy ratings and five hold ratings for the stock. Additionally, AlphaSpread has set a 12-month price target of €16.33, with estimates ranging between €13.13 and €18.90.

Given the company’s ongoing efforts to refocus capital and streamline operations, some analysts suggest a “Hold” position, allowing investors to monitor how these portfolio adjustments influence financial performance.

For Vitol, a privately held company, traditional stock market analysis does not apply. However, its expansion into upstream oil and gas suggests confidence in long-term demand for these resources, despite increasing global emphasis on energy transition strategies.

As the global energy landscape continues to shift, this transaction underscores the growing significance of West Africa as a vital player in oil and LNG supply chains. With Eni rebalancing its portfolio and Vitol strengthening its upstream position, the region’s energy dynamics are set to evolve, influencing both investment flows and market trends in the years to come.