Eni to buy First Calgary in C$923m deal

MILAN, Sept 8 (Reuters) Italy's Eni SpA has agreed to buy Canada's First Calgary Petroleums Limited in a cash deal worth C$923 million ($865 million), the latest in a series of acquisitions aimed at boosting its oil and gas reserves.brThe transaction is in line with our strategy of increasing our presence in our core countries, acquiring high potential assets, Eni Chief Executive Paolo Scaroni said in a statement Monday.brEni's stock rose 2.4 per cent to 20.74 euros by 643 a.m. EDT.brLast year, Eni paid 1.74 billion pounds for oil explorer Burren Energy Plc, which produces oil in the Republic of Congo and gas in Turkmenistan. It also bought Maurel & Prom's (MAUP.PA) stakes in fields in the Congo for $1.43 billion.brWith First Calgary, whose main asset is in Algeria, Eni will boost its reserves by about 190 million barrels of oil equivalent (mmboe) on a 2p basis in the country, the statement said. 2p means proven plus probable reserves, an estimate of what the company thinks is likely to be recovered over the life of the fields.brFirst Calgary has a 75 per cent stake in a license on the perimeter of Block 405b. Its partner is Algeria's state-run Sonatrach.brProduction start-up is expected in 2011 with a plateau of Eni's share of production of about 30,000 barrels of oil equivalent per day (boepd) by 2012, the statement said.brIt gives it (Eni) more leverage in the region, said ING analyst Jason Kenney.brEni has a development and production license with Sonatrach for fields in the Sahara desert. Production from the fields averages about 23,000 barrels boed.brIts other activities in the country include the construction of the Transmed gas pipeline across the Mediterranean.brUnder the deal, Eni is to pay First Calgary shareholders C$3.60 per share and convertible debenture holders $108,000 plus accrued interest for each $100,000 par value of bonds.brThe deal values the fully diluted share capital of First Calgary at about C$923 million.brIt's a good deal ... at a good price, ING's Kenney said.brFirst Calgary's board has voted unanimously to approve the deal, Eni said, adding it expected to close it in late 2008.