Eni directors approve Coral FLNG investment plan

The board of directors of the Italian oil and gas company Eni has approved the investment plan for the Coral South FLNG project offshore Mozambique.

The decision follows the approval of the Plan of Development for the Coral discovery, offshore Mozambique, given in February this year.

The plan of development foresees the drilling and completion of 6 subsea wells and the construction and installation of a Floating LNG facility, the capacity of which will be around 3.4 MTPA.

The first phase entails development of 5 trillion cubic feet of gas in the Coral discovery, located in the Area 4 permit. The Coral field is located in water more than 2000 meters deep and approximately 80 kilometers offshore of the Palma bay in the northern province of Cabo Delgado.

The giant discovery is estimated to contain 15 trillion cubic feet of gas in place, wholly located in Area 4.

While Eni’s board of directors has given its nod for the investment, the final investment decision is yet to be made, as Eni now needs approvals from other Area 4 partners. Eni also said the FID was subject to the project financing, “which is currently being finalized”, being underwritten.

Eni is the operator of Area 4 with a 50% indirect interest, owned through Eni East Africa (EEA), which holds a 70% stake of Area 4. The other Concessionaires are Galp Energia, KOGAS and Empresa Nacional de Hidrocarbonetos (ENH) with a 10% stake each. CNPC owns a 20% indirect interest in Area 4 through Eni East Africa.

To remind, Eni in October secured a major push towards the Final Investment Decision. Namely, Eni and its partners in the Area 4 concession have managed to find a major customer for the gas to be produced there – British energy major BP.

Under the agreement, BP will buy all the LNG to be produced by Eni’s Coral South Floating LNG unit, which will be installed offshore Mozambique, over a period of 20 years. Commercial details of the agreement were not disclosed. As for the FID date, both Eni and BP have previously said it can be expected by the end of 2016.

 

Offshore Energy Today Staff

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