Italian Energy Firm Buys First Calgary Petroleum For $923 Million

Calgary, Alberta (AHN) - Eni SpA of Italy purchased on Monday for $923 million First Calgary Petroleum Limited. Eni is a major integrated oil and gas firm.

It paid $3.60 a share for the Calgary-based energy firm, representing a 53 percent premium from the company's closing price on Sept. 2 of $2.36.

First Calgary's board of directors and a group of investors who control 18 percent of the energy company favored the buy-out. Eni explained it was interested in First Calgary because of its 75 percent interest in a large natural gas field in Algeria which fits the Italian firm's existing operations in North Africa.

Eni president and chief executive officer Paolo Scaroni, in a statement, said, "We are committed to the successful and rapid development of these gas fields and the consequent rapid start up of an important resource for the country."

Eni owns a pumping oil and gas field in Algeria since 1981 and a major natural gas pipeline that transmits gas from Algeria to Tunisia and Italy. First Calgary's holdings at Algeria were estimated at 1.3 billion barrels of energy, half oil and half natural gas.

With its buy-in, Eni will increase its overall production by 190 million barrels of energy of energy equivalent since First Calgary's Algerian field is expected to have a daily output of 30,000 barrels of energy by 2012.

Shane O'Leary, president and chief executive of First Calgary, said in a statement, "We will work with Eni to ensure a smooth transition and avoid disruptions to the project. We believe the resources and expertise that Eni can bring to this project should accelerate the development."