Milan — Two contracts signed in Saudi Arabia for $3.5 billion by Italy’s oil contractor Saipem are part of a shift in the company’s strategy to focus more on natural gas, Chief Executive Stefano Cao said on Wednesday.
Saipem said on Tuesday it won two new contracts from Saudi Aramco for the development of land facilities of the Berri and Marjan gas fields, which are both located in the Arabian Gulf.
The gas contracts announced on Tuesday “confirm that this is the fundamental strategy for our company,” Cao said.
Saipem shares rose 2.9% in Milan on Wednesday, outperforming a 0.8% rise in Italy’s blue-chip index.
“The news is very positive and improves the visibility of our estimates on 2020-2022, in particular for the E&C (Exploration and Construction) onshore division”, broker Equita said.
Cao met in Milan on Wednesday with Filipe Nyusi, the president of the Republic of Mozambique, where Saipem last month won a $6 billion exploration, procurement and construction contract for the Anadarko Mozambique liquefied natural gas project.
The Saipem CEO said Mozambique, a gas producer, would become one of the most important countries in the company’s portfolio.
“In the energy transition (towards renewables) the gas chain will play a fundamental role,” Cao said.