ENI hires bank to sell portion of oil block in Mozambique

1 April 2014

Italian oil group ENI has hired Bank of America Merrill Lynch to advise it on the sale of a 15 percent stake in the Area 4 block of the Rovuma Basin in northern Mozambique, financial news agency Reuters reported citing sources close to the process.

The group plans to find partners to share the high investment needed to process the natural gas deposits in the block. It previously sold a 20 percent portion of the total 70 percent it owned to the China National Petroleum Corporation for US$4.2 billion.

The group plans to invest US$78.11 billion between 2013 and 2016 on oil and natural gas exploration, including in Mozambique, where it is the operator of the Area 4 block.

Sources cited by Reuters said that the China National Offshore Oil Corporation could be one of the buyers as it has plans to enter the natural gas extraction business and the gas that will be liquefied in Mozambique will likely be exported to Asian buyers.

The Area 4 block, which was handed over as a concession in February 2007, had as its original partners ENI (70 percent), Portugal’s Galp Energia and Korea Gas as well as Mozambican oil and gas company Empresa Nacional de Hidrocarbonetos, with 10 percent each. (macauhub)