Mozambique Oil & Gas: ExxonMobil signals formal entry as Mamba LNG Operator on Rovuma Area 4

Mozambican state oil andgas company ENH, Italian group ENI, South Koreas Kogas and Portugals Galp Energia, the concession holders on the Area 4 natural gas block in the Rovuma basin, Mozambique, on Tuesday in Maputo, approved the entry in the consortium of US group Exxon Mobil, according to Mozambican daily newspaper Noticias.

In March of this year, the ExxonMobil group acquired a stake of 35.7% in ENI East Africa, a company that acts as the operator of the Area 4 block, whose partners are Italian group ENI (35.7%) and the China National Petroleum Corporation (28.6%).

Speaking at the Tuesday ceremony, the Minister of Mineral Resources and Energy, Leticia Klemens, cited in the Wednesday issue of the Maputo daily “Noticias”, said “an important step has been taken towards implementing the natural gas liquefaction project”.

“With the signing of this complementary agreement”, she said, “ExxonMobil will be able to contribute to the implementation of the projects in Area Four”. Part of the arrangement is that, although ENI remains the operator of Area Four, and is in overall charge of the floating liquefied natural gas (FLNG) platform to be installed above the Coral South gas field, ExxonMobil will take responsibility for managing and implementing onshore operations. These will include gas liquefaction plants to be built on the Afungi Peninsula in Palma district.

The government of Mozambique authorized the transaction in September changing the stakes in the Area 4 block and ENI and ExxonMobil now have 25% each, the CNPC group has 20% group and Galp Energia, Kogas and Mozambican state oil and gas group ENH have 10% each.

The entry of ExxonMobil as a shareholder in the project, Klemens said, strengthened her belief that Mozambique will become one of the largest exporters of natural gas in the world.

The agreement, she added, “will allow us to use the great technical competence and financial robustness of ExxonMobil, which is a world leader in petroleum operations, with great mastery of the natural gas market”.

The permission for ExxonMobil’s entry into the project was regarded as essential for the Mozambican state to raise around US$354.4 million from capital gains tax charge to ENI on the transaction.