Gas discoveries breath new life into Mozambican investments, Petrobras says

22 August 2007

Sao Paulo, Brazil, 22 Aug – Reserves of natural gas recently discovered in Mozambique have justified Petrobras’ investment in the country and also point to there being oil in the same areas, the prospecting manager of the international area of the Brazilian state oil company told Macauhub Tuesday.

According to Manoel Murilo Silva, the recent discovery of two gas fields is a strong indication that there is oil in Mozambique, although it is not possible to be precise about where or in what amount its might be found.

“Mozambique is part of an area that we classify as the new fronteir. The fact that there are gas fields shows that we are on the right road,” Silva said.

Although the main interest of the oil company is oil exploration, the discovery of gas fields in the region “would already justify the company’s interest in Mozambique,” the manager said.

In October 2006, Petrobras signed a memorandum of understanding with Mozambique’s Empresa Nacional de Hidrocarbonetos (ENH) for oil and natural gas miningd, as well as for biofuel research on Mozambican soil.

Next month, the Mozambican president, Armando Emílio Guebuza, is due to visit Brazil where he is expected to sign an energy deal with Brazilian president, Luiz Inácio Lula da Silva, extending the terms outlined in the first memorandum, to fuel exploration and export.

“Petrobras has several areas of interest in that region, from mining nd production to research and development of a market for external distribution, mainly to South Africa, as internal demand (of Mozambique) is restricted, ” he told Macauhub.

Murilo Silva said that the company’s interest in Mozambique was “natural”, mainly because it is a country “that speaks the same language” and has “great synergy” with Brazil.

African projects are part of the investment plan announced last week by the oil company, which plans to spend US$112 billion on increasing exploration and production of oil and gas, as well as developing the downstream sector(refining, transport and sales) and the petrochemical capacity of biofuels by 2012. (macauhub)