Eni and BP looking to raise $2bn for proposed oil and gas JV in Angola

The Italian and British energy giants have reportedly contacted a number of major banks to raise fund as they seek to cut debt.

Eni and BP plan to merge their assets in Angola. Credit: bp plc.

Eni and BP are reportedly mulling to raise up to $2bn to fund their proposed oil and gas joint venture in Angola.

In May 2021, the two firms started talks to merge their Angolan oil, gas and LNG assets in a new joint venture (JV) company to form one of the largest energy companies in Africa.

The new JV is expected to bring significant opportunities to boost future developments and operations in the country.

Citing banking and industry sources, Reuters reported that the merger plan comes as the two parties seek to reduce debt and greenhouse gas emissions, and shift towards renewables businesses.

Unidentified sources further revealed that the Italian and British energy giants have contacted a number of key Western banks in the recent weeks to raise $1.5bn-$2bn for the joint venture.

One of the sources was cited by Reuters as saying: “They are trying to deconsolidate the Angolan assets and want to raise cash for the joint venture’s upstream operations.”

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As a second source noted: “The idea is not just to cut debt but to invest more in Angola and faster.”

However, increasing pressure from the investor and government to reduce fossil fuels investments would make it difficult for several Western banks to lend them money, the sources said.

Last month, BP CFO Murray Auchincloss told the news agency that the JV with Eni is aimed to create ‘a much more efficient company’ to explore, drill and produce oil and gas in the African country.

Eni earlier said that advisors were appointed by the two parties to support raising finance for the new joint venture.

In Angola, Eni serves as operator of block 15/06, and exploration blocks Cabinda North, and Cabinda Centro.