Eni Works With Alaska On Major Development Project

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Company to develop 70 wells in Nikaitchuq oil field

January 26, 2008, Juneau, Alaska – Alaska Governor Sarah Palin today commended the major investment announced by Italian oil giant Eni. The company will invest $1.45 billion developing the Nikaitchuq oil field. Eni expects to drill 70 wells to recover 180 million barrels of oil.

“We are pleased that Eni has recognized the tremendous resource wealth and opportunity that Alaska has to offer,” Governor Palin said. “Continued oil and gas exploration is significant to Alaska’s future, creating real jobs for Alaskans. We look forward to a long and successful relationship with Eni.”

On October 16, Eni submitted an application to Alaska Department of Natural Resources (DNR) Commissioner Tom Irwin requesting modification of royalty terms on 12 leases in the Nikaitchuq Unit. After assessing the financial performance and economic benefits, on January 11 Commissioner Irwin approved a modification that allows Eni’s royalty obligations to fall to 5 percent when prices are at $42.64 per barrel or lower.

Alaska law allows the DNR commissioner to make royalty modifications in order to meet investment thresholds.

Full details of the modification can be found at: www.dog.dnr.state.ak.us/oil/programs/incentives/2008/2008_nik_finalfindi...

Source: Alaska Governor