ExxonMobil pays US$2.8 billion for 25% of natural gas block in Mozambique

US group ExxonMobil paid US$2.8 billion in cash to Italian group ENI for an indirect 25% stake in the Area 4 block of the Rovuma basin in northern Mozambique, under a contract signed on Thursday.

Prior to this deal, the ENI group held an indirect 50% stake in the block through a 71.4% stake in ENI East Africa, which in turn owns 70% of the Area 4 concession.

Once completed and approved by the competent authorities, including the government of Mozambique, ENI East Africa’s shareholders will be ENI, with 35.7%, ExxonMobil with 35.7% and China National Petroleum Corporation (CNPC), with 28.6%.

The other partners in the Area 4 block are state oil company ENH, Portuguese group Galp Energia and South Korean group Kogas, each with 10%.

The world natural gas market has been flooded in recent years with gas extracted in Australia and the United States but the ExxonMobil and ENI groups are counting on the continued increase in demand as many thermal coal-fired plants are remodelled to start using natural gas.

The Italian group will continue as the operator of the floating platform project of the Coral field and all downstream operations while the ExxonMobil group will take over the construction and operation of onshore facilities for liquefaction of natural gas.

The statement released by the US group said the Area 4 block contains natural gas reserves estimated at 85 trillion cubic feet, “enough for the proposed gas liquefaction project to have a global dimension.” (macauhub)