After discovering 15.2 trillion cubic feet of natural gas off the coast of Mozambique last month, Eni (NYSE: E) recently upped its estimate to 22.5 tcf and announced it would invest $50 billion in developing the resource. It's the company's second multibillion-dollar development announcement over the past two weeks.

Spend, spend, spend
On top of its initiative to develop Mozambique's natural gas, Eni has also committed $20 billion to develop the Zubair oil field in Iraq. Working with Occidental Petroleum (NYSE: OXY), Eni's contract in Iraq is good for 20 years. Iraq holds what are believed to be the fifth largest oil reserves in the world, and the investment could prove to be quite lucrative.

Debt, debt, debt
Still, $70 billion is a lot to think about. Eni's net borrowings are up this quarter, which is a perfect segue to its debt picture.

Company

Debt/Equity
(MRQ)

Operating Cash Flow
(TTM)

Return on Assets
(TTM)

Eni 51.8% $19.7 8.0%
Statoil (NYSE: STO) 45.8% $16.2 16.4%
ExxonMobil (NYSE: XOM) 10.3% $57.7 10.8%
Royal Dutch Shell (NYSE: RDS-B) 23.7% $35.8 8.0%
BP (NYSE: BP) 41.1% $17.0 6.5%
Total (NYSE: TOT) 49.2% $27.7 9.9%

Source: Yahoo! Finance. Dollar figures in billions. MRQ = most recent quarter, TTM = trailing 12 months.

It's hard not to be in awe of ExxonMobil's stats here -- 10.3% debt to equity is simply magnificent. Eni's debt, on the other hand, makes me nervous, even if it's a case of short-term pain for long-term gain.

Shedding assets
Eni is selling pipelines in Europe. Divesting assets is a great way for the company to get some of its debt under control.

Eni also recently joined Shell and Total in divesting their stake in two Nigerian onshore oil fields. Oil and gas operations in Nigeria have been increasingly victimized of late, as frustrated citizens attack pipelines and steal oil. It's a smart move, but unless Eni is proactive about operating differently in East Africa, the company will face the same problems.

CEO Paolo Scaroni met with the president of Mozambique, Armando Guebuza, to discuss plans for developing the gas assets and the effect it will have on the country. Mozambique is one of the poorest countries in the world and can certainly benefit from this project, provided it doesn't turn into another Nigeria.

Foolish bottom line
Eni is investing heavily in two plays that could be incredibly lucrative in the future. Investors should carefully monitor the progress of these investments, however, because both opportunities are located in regions of high political risk.