The shutdown of Europe’s largest onshore oil field in Italy over alleged illicit waste disposal at a nearby treatment plant will probably only have a “negligible” effect on Eni’s earnings, according to an analyst cited by Bloomberg.
At the end of March, Reuters reported that five staff at a treatment plant – located in the Val d’Agri oil concession area in the Basilicata region and operated by oil major Eni – were placed under house arrest on allegations of illegal waste trafficking. The arrests of managers and workers are part of a two-year-long investigation by regional anti-mafia prosecutors into waste management at the plant in southern Italy. Production at Val d’Agri, in which Royal Dutch Shell also has a stake, was halted after Italian authorities seized part of a nearby oil-treatment facility amid a waste-disposal investigation.
Eni has said it is cooperating with the authorities and has asked prosecutors to restart production –around 75,000b/d–something that according to the expert might happen in a matter of days or a few weeks.
However, as Italy often allows operations to resume during probes, Giuseppe Rebuzzini, an analyst at Fidentiis Equities, said that the ongoing investigation and plant shutdown will not have a big impact on Eni. In fact, in 2015 a shipyard owned by Fincantieri at Monfalcone near Trieste was allowed to resume production within a week after authorities started an investigation into waste disposal. The same pattern was also repeated at a plant owned by steelmaker Ilva in Taranto.